Tuesday, November 16, 2010

#Alert* Musa: Sime Darby to take civil action

KUALA LUMPUR: SIME DARBY BHD [] chairman Tun Musa Hitam said civil action would be taken following the investigations into the losses at its energy and utilities division.

He said on Tuesday, Nov 16 that civil action is being taken by the company; and it was expected that it would commence legal proceedings before the end of the year.

Speaking at Sime Darby's AGM, he told shareholders that in the forensic report, the advisers have identified individuals with prima facie culpability.

Below is the statement issued by Sime Darby:

During its annual general meeting this morning, Tun Musa Hitam, Chairman of Sime Darby Bhd, delivered a statement to shareholders to explain the company's position with regard to several issues. The statement is reproduced below:

There has been a lot of interest and even more speculation with respect to the investigations that the company has been conducting into the losses at our Energy & Utilities Division.

I am making this statement to clear the air, hopefully once and for all, so that fact and speculation can be separated.

Also, I want to make it clear at the very outset that for legal reasons, we cannot table the findings of the forensic audit today and neither will we be revealing the findings today, because we must follow due process of law and protect the best interests of the Group in undertaking the necessary legal claims on behalf of the Group.

There have been reports in the media quoting me, but I want to categorically state that this is absolutely wrong ' I did not say this at all.

The facts are: On 6 July 2010 the Board of Directors established the Investigative Reports Review Committee with Tan Sri Samsudin Osman as the chair.

This committee was set up to consider and review the draft Investigative Review Reports that were prepared by forensic and legal advisors appointed by the Board with respect to certain projects of the E&U Division.

The Committee was to report any prima facie findings of culpable conduct and whether there was possible civil action that could be taken against those culpable. In simple terms, this means that The Committee was to report who may have been in the wrong and whether or not we can take action against these people.

The final report of the external consultants was submitted to The Committee on 14 September 2010 and was considered by the Board on 20 September 2010.

It is my duty to inform you that The Committee's and consultants' reports have been handed to the Securities Commission and a report has been lodged with the Malaysian Anti Corruption Commission.

These two bodies have informed us that they are conducting further investigations.

It is because of these on-going investigations that we are unable at this time as advised by legal counsel, to make the findings of The Committee known to you. The board has been advised by legal counsel to keep confidential the details of the report and nature of such proceedings so as not to adversely affect the interests of the Group.

What I can tell you is: (I) civil action is being taken by the company; (II) it is expected that we will commence our legal proceedings before the end of the year and (III) in the forensic report, the advisors have identified individuals with prima facie culpability.

We will have to leave it to the Securities Commission and the MACC to take this further. As you know, criminal action is not within the purview of the company but in the hands of the authorities. Our role is to cooperate with the authorities and we have done so and will continue to do so as and when required.

Meanwhile, Sime Darby has engaged the services of a senior counsel who is, at the moment, preparing the civil actions to be filed. As soon as can be done after the civil action is filed and served, we will publish the claims for you to read. However, until a case is filed and served, legal counsel has advised that the details will need to remain confidential.

Meanwhile, your Board and the Management, led by our Acting President and GCE, have also drawn up a strategic plan to place the company on a stronger footing and to ensure that while controls, systems and processes are tightened, opportunities to grow and expand will not be missed.

Thank you.

Tun Musa Hitam

Chairman, Sime Darby Berhad

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