KUWAIT CITY, Kuwait -- Kuwait's parliament Wednesday ordered
probes into a $2.5 billion power plant contract and a deal with
Airbus Group N.V. (AIR.FR) to purchase 25 aircraft and lease 12
others.
Twenty-one lawmakers out of 36 present approved a proposal to
ask the parliament's legal committee to investigate "all deals"
being undertaken by state-owned Kuwait Airways Co.
Lawmaker Adnan Abdulsamad said the probe is "necessary amid
reports that the KAC board has turned down cheaper offers," without
providing further details.
In December, KAC signed a memorandum of understanding with
Airbus to buy 25 planes and lease 12, with an option to purchase 10
more. The value of the deal hasn't been disclosed.
KAC officials have said the airline has obtained the necessary
authorization from the government.
The agreement includes the purchase of 15 A320neo and 10
A350-900 planes with the option to buy 10 more, five from each
category, to be delivered in 2019 and 2020.
The final contract for the deal, the first plane order by KAC in
more than 20 years, has not yet been signed.
Parliament also voted to form a special committee to probe
allegations of irregularities in awarding the contract for Al-Zour
North Power Plant project.
A consortium comprising Japan's Sumitomo Corp. (8053.TO),
France's GDF Suez SA (GSZ.FR) and Kuwait's Abdullah Hamad Al-Sagar
and Brothers won the contract.
Kuwait's parliament launched a similar probe last February, but
the legislature was dismissed by the constitutional court before
the investigation was concluded and fresh elections were held.
The winning consortium signed the final contract with the
government in December and construction work has begun.
The consortium awarded South Korea's Hyundai Heavy Industries
Co. Ltd. (009450.SE) the contract to construct the power plant and
tasked French firm Sidem with building the desalination
facility.
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