Economy

AirAsia CEO Tony Fernandes steps aside amid Airbus bribery allegations

AirAsia CEO Tony Fernandes steps aside amid Airbus bribery allegations”

Tharumalingam a/l Kanagalingam, also known as Bo Lingam (pictured below), current AirAsia Group president (airlines), has been appointed as acting CEO of AirAsia Group in the interim.

At the same time, regulators Malaysian Aviation Commission and Securities Commission Malaysia as well as enforcement agency Malaysian Anti-Corruption Commission have launched independent investigations into the scandal. AirAsia's and AirAsia X's shares fell this morning following the news. On Monday, AirAsia shares sank 10 per cent, while AirAsia X shares dropped 12 per cent.

This means Fernandes, who was chief executive officer (CEO) cum executive director, has been redesignated as non-executive director, while Kamarudin, who was AirAsia's executive chairman, is now the company's non-executive chairman.

Meanwhile, Fernandes and Kamarudin in a joint statement denied any allegations of wrongdoing or misconduct.

AirAsia has said it will fully cooperate with Malaysia's Anti-Corruption Commission, which is working alongside Britain's Serious Fraud Office (SFO) probing the claims.

The allegations were revealed as part of a record US$4 billion settlement Airbus agreed with France, Britain and the United States.

More news: Stocks Cut Gains on Virus Fears

Kamarudin and Fernandes also said they welcome any investigation by the authorities, saying that is the only way they would receive the fairness and access to justice denied them by the SFO process to date.

The SFO said on Friday that between October 2013 and January 2015, EADS paid $50 million to sponsor a sports team which was jointly owned by two people described as AirAsia Executive 1 and Executive 2.

On February 3, the group had announced on Bursa Malaysia that Tan Sri Tony Fernandes and Datuk Kamarudin Meranun have relinquished their executive posts effective immediately.

Identified as "key decision makers" in AirAsia and AirAsia X - the company long-haul arm - they were allegedly rewarded with the order of 180 aircraft from Airbus.

"The involvement of Airbus in the sponsorship of the sports team was a well-known and widely publicized matter bringing branding and other benefits to Airbus", the statement said. It said Airbus employees offered an additional $55 million, though no payment was made.

"The committee's main objective will be to review the allegations therein so far, as it concerns AirAsia Group Bhd, and to take any necessary action based on the review", AirAsia said.



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