KUALA LUMPUR: Merely five days after Tanjung Offshore Bhd filed a legal suit against its directors and their related parties, the oil and gas (O&G) services provider has decided to extend an olive branch, opening the door for the affected parties to call a truce.   

Several filings with Bursa Malaysia yesterday saw a slew of changes to Tanjung Offshore’s board. 

The most significant would be the redesignation of its third largest shareholder Tan Sri Tan Kean Soon as executive director, replacing Muhammad Sabri Ab Ghani, who resigned yesterday for “personal reasons”. 

Kean Soon has a 7.58% stake in the company.  

Apart from Muhammad Sabri, 43, George William Warren Jr, 45, also resigned as independent non-executive director “to explore other opportunities elsewhere.”

Alongside Kean Soon, Tanjung Offshore (fundamental: 1.85; valuation: 0.60) has also appointed Datuk Mohd Hafarizam Harun as chairman, after naming him an independent non-executive director yesterday. 

Three others were also appointed independent non-executive directors, namely Datuk Dr Nik Norzrul Thani N Hassan Thani, Datuk Maheran Mohd Salleh and Tan Sam Eng.

Yesterday, Tanjung Offshore also received a notice from Kean Soon, Nik Norzrul Thani and Datin Norhafizah Mohd Nordin, who collectively hold no less than 10% shares in the company, to call off an extraordinary general meeting (EGM), slated for Friday.

Another filing with Bursa noted that the withdrawal notice from the trio was received after the upliftment of the suspension of three officers — Kean Soon, Muhammad Sabri and Datuk Harzani Azmi — with immediate effect.

In the notice of the withdrawal, the trio said the withdrawal was due to the fact that Nik Norzrul Thani, Maheran and Sam Eng had been appointed to the board of directors.

“Warren, one of the three directors that the requisitionists intended to remove, had resigned from the board of directors of the company today (yesterday). As such, our intention of calling the EGM had been rendered redundant,” said the trio in the notice.

Tanjung Offshore also pointed out that the audit committee, in consultation with Bursa, on March 20, 2015, appointed Ferrier Hodgson M H Sdn Bhd as a special auditor to review matters highlighted by the independent committee (IC).

It is, however, not known if the company would drop the legal and defamation suits filed against Kean Soon and related parties in the last two weeks.

While yesterday’s announcements may suggest a truce has been reached between the two groups led by Kean Soon and newly-appointed chief executive officer Rahmandin Md Shamsudin, investigations by the authorities are expected to proceed as the IC findings have been submitted to Bursa, the Securities Commission Malaysia and the police.  

To recap, Kean Soon initially planned to remove Warren and two other directors — Datuk Ab Wahab Ibrahim (non-executive director) and Shahrizal Hisham Abdul Halim (independent non-executive director) at the proposed EGM. 

Kean Soon also proposed to appoint Nik Norzrul Thani, Datuk Rosman Hasan, Datuk Norazman Hamidun, Maheran and Sam Eng as new directors.

Warren, Ab Wahab and Shahrizal Hisham were members of the IC established by Tanjung Offshore’s board of directors on Jan 8 this year. The formation of the IC, among other things, was to review some of Tanjung Offshore’s past deals and to engage professionals to perform an independent valuation if necessary. 

The findings of the IC, released on Jan 28 this year, pointed at possible conflicts of interest and breaches of fiduciary duty by Kean Soon and Muhammad Sabri, and deficiencies in the approval process where Harzani was concerned, according to a statement by Tanjung Offshore. 

As a result, their executive and advisory roles were suspended on the same day. 

The IC findings said that Kean Soon and Muhammad Sabri had approached Bourbon SA for a vessel contract via the former’s private-vehicle HMS Oil and Gas Sdn Bhd during Tanjung Offshore’s heads of agreement (HoA) period.

The IC said that these actions may have resulted among other things in a “loss of business opportunity and potential income stream related to the Bourbon deal”. 

Tanjung Offshore signed an HoA with Paris-based Bourbon SA in June last year which would result in a reverse takeover (RTO) by the latter. However the RTO was aborted last December due to the prevailing economic and financial conditions. 

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This article first appeared in The Edge Financial Daily, on March 24, 2015.