AirAsia: ‘We have no dealings with Rolls-Royce’

PETALING JAYA: Refuting reports linking it to a Rolls-Royce plc bribery case, AirAsia Bhd says it has had no dealings or transactions with the United Kingdom engine maker.

The low-cost carrier further noted that the group had no knowledge of any matter mentioned in an article entitled “AirAsia denies wrongdoing in dealings with Rolls-Royce” in The Financial Times (FT) on Jan 22.

“AirAsia has had no dealings or transactions with Rolls-Royce and has no knowledge of any matter mentioned in the article,” the group clarified in filings with Bursa Malaysia yesterday.

“In respect of the Bombardier Global Express corporate jet owned by Caterhamjet Global Ltd (CJG) mentioned in the article, we wish to advise that AirAsia had already gone through the due process and obtained the necessary approval on the transaction from the company’s Audit Committee, its board of directors and recommended to its shareholders for approval under the recurrent related-party transactions circular at the respective general meetings held on June 3, 2015, and May 30, 2016,” it added.

AirAsia further noted that the duly obtained shareholders’ approvals were subsequently announced to Bursa Malaysia Securities Bhd on the same respective dates.

“Under the agreement executed for the transaction, AirAsia is required to make an annual contribution of US$3mil (RM13.3mil) per annum for the use of the corporate jet. The annual contribution covers the cost of fuel, aircraft engineering and maintenance, route charges, landing fees, parking charges, ground handling charges and security and immigration costs, and in return, CJG agreed to provide a minimum of 75 flight hours per month to AirAsia executives,” the group said.

“Prior to 2015, the use of the corporate jet for the carriage of the group chief executives of AirAsia and AirAsia X Bhd were contracted through AirAsia Asean Ltd, and the costs incurred for the use and upkeep of the aircraft was paid by the company’s associate companies such as Thai AirAsia and Indonesia AirAsia, and not AirAsia,” it added.

AirAsia said it has since entered into a sale and purchase agreement to acquire that same corporate jet from CJG on June 21, 2016 as was announced to Bursa.

The completion of the transaction, however, was still pending.

The FT article over the weekend said AirAsia had denied wrongdoing after the UK’s Serious Fraud Office alleged Rolls-Royce had failed to prevent its employees from bribing an AirAsia executive with a US$3.2mil (RM14.2mil) discount for the maintenance of a private jet.

The same article noted that AirAsia group chief executive officer Tan Sri Tony Fernandes partly-owned the jet.

It quoted AirAsia as saying it had “followed all procedures” in obtaining credits from Rolls-Royce and that the private jet was used by the AirAsia executives for business travel, with the airline paying for operational and maintenance costs.