Malaysian cargo airline Transmile, a key DHL Express partner for inner-Asian and transpacificroutes, has been hit by an accounting scandal that has forced the resignation of its chief
executive.A special audit found financial irregularities in Transmile’s accounts dating back to 2004,relating to dealings between the airline and freight transport company CEN Worldwide, in which itindirectly has a minority stake. The dealings related to invoicing between the two companies.
The airline’s founder, former owner and CEO, Gan Boon Aun, who was also a CEN director, hasresigned following the audit findings. CEN Worldwide was set up by the airline, Pos Malaysia andother investors in the late 1990s as an express logistics company.
According to the Malaysia Star newspaper, CEN Worldwide is loss-making and is the airline’slargest customer with revenues of RM 604 million over the last three years. Transmile said in astatement to the Malaysian stock exchange, where it is listed, that it will propose a new specialaudit on CEN Worldwide.
DHL has blocked space capacity agreements on Transmile flights from Malaysia via the DHLExpress’ Asia hub in Hong Kong to the USA, as well as to India and several other Asiandestinations. In June 2006 the two companies signed a five-year strategic network alliance dealgiving DHL the flexibility to add new air services or upgrade existing services.
Transmile, with a fleet of four MD-11Fs, 10 B727Fs and four B737Fs, flies from Kuala Lumpurto regional destinations, including Japan, China and India, and has fifth-freedom cargo rights inHong Kong for its flights to the USA and India.
