April 2 (Bloomberg) -- SBM Offshore NV, a Dutch supplier of floating oil-production platforms, said an internal probe found no credible evidence of improper payments made to Brazilian government employees from 2007 through 2011. The shares rose to the highest in eight weeks.
There were certain “red flags” in the handling of $139.1 million of payments in Brazil, though the probe determined the agent involved “provided substantial and legitimate services,” Schiedam, Netherlands-based SBM said in a statement today. There’s some evidence that payments may have been made directly or indirectly to government officials in Equatorial Guinea, where commissions to agents amounted to $18.8 million, and Angola, where agent commissions totaled $22.7 million.
Brazil accounts for almost half of SBM’s revenue. The findings are in line with an audit at Petroleo Brasileiro SA, the Dutch company’s biggest customer. SBM said it’s in talks with the Dutch prosecutor and U.S. Department of Justice on the findings of the investigation and is unable to estimate potential financial damages at this stage.
“If it was up to me, we would be finished by tomorrow, but they have their own judgments to make,” Sietze Hepkema, SBM’s chief governance and compliance officer, said on a conference call today. He declined to comment on when the authorities are expected to conclude their investigations.
SBM gained as much as 8.1 percent to 14.26 euros, the highest intraday price since Feb. 6, and was trading up 4.9 percent at 13.84 euros at 10:18 a.m. in Amsterdam. That pared the stock’s decline this year to 6.5 percent, valuing the company at 2.89 billion euros ($4 billion).
Petroleo Brasileiro, the Rio de Janeiro-based oil producer known as Petrobras, said on March 31 that it found no wrongdoing by its employees in connection with SBM’s contracts.
SBM has “quite a bit of headroom” in resources to pay for potential fines, Chief Financial Officer Peter van Rossum said on the conference call.
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