| Type | Announcement |
| Subject | OTHERS |
| Description | TELEKOM MALAYSIA BERHAD (“TM”) : INTERNAL INVESTIGATION ON THE ALLEGED IMPROPER PAYMENTS BY ALCATEL LUCENT TO TM EMPLOYEES |
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We refer to our announcements dated 29 December 2010, 3 January 2011, 6 January 2011, 2 February 2011 and 1 March 2011 with respect to the Settlement entered into between Alcatel Lucent SA and the United States’ Securities and Exchange Commission and the Department of Justice, the formation of the Board Audit Committee’s Sub-Committee (BSC) of TM to conduct an independent internal investigation into the alleged improper payments to TM employees and the conclusion of the internal investigation and submission of the Report to the Malaysian Anti-Corruption Commission (“MACC”) respectively.
Further to our previous announcements on the above matter and the continuous evaluation by the Board, taking into consideration the meeting between Bursa Malaysia Berhad and the Board Audit Committee of TM held recently, we furnish herewith the following additional information: 1. Whether there may be any financial or operational impact arising from the findings of the investigation into the alleged improper payments by Alcatel to TM employees, including the status of the subject contract awarded to Alcatel? There is no financial impact apart from the cost of investigation and related administrative expenses. The contract in question relates to a technology that TM does not operate anymore, so there are no immediate impacts on operations. TM also does not foresee any major impact on the existing operations as the Board agreed that TM will honour prior contractual obligations entered into with Alcatel Lucent SA and its group of companies. TM Board has considered and deliberated the findings of the investigation and agreed that the Report by KPMG Corporate Services Sdn Bhd be submitted to the MACC which was duly furnished on 1 March 2011. The Board has not yet finalized the actions or solutions with regards the alleged improper payments received by TM employees which are pending the outcome of the MACC investigation. Following the press statement issued on the 27th December 2010 by Alcatel Lucent SA where it admitted that it had entered into a deferred prosecution agreement with the United States’ Department of Justice, TM Board has agreed to suspend Alcatel-Lucent SA and its group of companies (which include Alcatel-Lucent Malaysia Sdn Bhd) (hereby collectively referred to as “ALU”) from participating in ongoing and future tender and procurement proposals issued by TM and its wholly-owned subsidiaries (TM group of companies). This decision also applies to any consortium, joint-venture or partnership of which any member of Alcatel-Lucent SA or its group of companies, is a party. This decision is effective for a period of 12 months from 5 January 2011 and may be reviewed from time to time subject to ALU providing assurances and evidence satisfactory to the TM Group that it has implemented clear and enforceable policies and measures to prevent a recurrence of any improper acts and the TM Group's operational requirements from time to time. The suspension will not affect any arrangements which the TM Group considers to be critical to its network operations. TM Board has deliberated the findings and Report of the BSC on the need for TM to continue improving its processes to further strengthen the internal controls and risk management of the Company. Accordingly, the Board has accepted the BSC’s recommendations and directed the Management to review the overall improvement measures. TM will make relevant announcement on any material development to the said matter (if any). This announcement is dated 23 March 2011. |
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| Company Name | TELEKOM MALAYSIA BERHAD |
| Stock Name | TM |
| Date Announced | 23 Mar 2011 |
| Category | General Announcement |
| Reference No | TM-110323-DF89C |