KUALA LUMPUR (June 23): Tanjung Offshore Bhd has lodged a police report on its purchase of a chromite mine in the Philippines and a rubber-material substitute plant in China, and has also made a formal complaint to the Malaysian Anti-Corruption Commission (MACC) regarding a property purchase in the UK.

In a statement today, the company said the three deals were negotiated and executed under the previous board of directors and were identified as irregular, following a forensic audit by Ferrier Hodgson.

The MACC report was filed against a former director of Tanjung Offshore (fundamental: 1.65; valuation: 0.9) and several ex-senior officials for “corruptly receiving gratification” after facilitating the company’s purchase of a property in Birmingham, UK.

The company spent RM62.7 million to purchase the property, out of which a total of RM27.4 million for refurbishment is still being investigated.

Meanwhile, a police report was made against the same former director and a China national for dishonestly and fraudulently misappropriating the company’s funds in the Philippine chromite mine deal and ethylene propylene diene monomer (EPDM) project in China.

Ferrier Hodgson noted that excessive professional fees of RM2.7 million were paid for the EPDM project, out of the total investment of RM3.2 million. The payments made had bypassed the company’s corporate protocol.

Besides that, the investment of RM6.2 million into a chromite mine in the Philippines in 2013 had also bypassed protocol.

“We filed these formal reports to help clear the decks and put the company back in shape. This means cleaning up the questionable deals identified by the Ferrier Hodgson forensic audit,” said Tanjung Offshore executive director and group chief executive officer Rahmandin Md Shamsudin.

He said the filing of the reports were some of the first steps as recommended by the company’s special task force, adding that “there will be more to come”.

“The reports to MACC and the police will help Tanjung Offshore get to the bottom of the irregularities in these deals as spelt out by minority shareholders and some board members.

“We will continue to work with MACC, police, the regulatory bodies and legal advisers to ensure these wrongs highlighted by the forensic audit are put right,” he added.

Tanjung Offshore closed 2 sen or 4.4% higher at 47.5 sen per share for a market capitalisation of RM172.47 million.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)