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By Kirstin Ridley and Allison Lampert
(Reuters) - The UK Serious Fraud Office announced on Thursday it was investigating Canadian industrial group Bombardier <BBDb.TO> over suspected bribery in airplane sales to Garuda Indonesia <GIAA.JK>, widening a global anti-corruption drive in aerospace.
The plane and train maker is the latest aerospace group to face scrutiny over the use of middlemen after authorities struck a record bribery settlement with Europe's Airbus in January and a 2017 plea deal with British engine maker Rolls-Royce <RR.L>
Both settlements involved sales of planes or engines to Garuda and airlines in other countries.
"The SFO is investigating Bombardier Inc over suspected bribery and corruption in relation to contracts and/or orders from Garuda Indonesia," the agency said on Thursday.
"As this is a live investigation, the SFO can provide no further comment," it added.
Garuda did not immediately respond to a request for comment.
In Montreal, Bombardier said it had been informed about the SFO probe several weeks ago and would cooperate. It has appointed external lawyers to run an internal review.
Shares in the company, which also reported results on Thursday, fell more than 3% after the SFO's announcement. In afternoon trade they were down about 1.7%..
At the centre of the case, Bombardier said, are five procurement processes involving different manufacturers, including the 2011-2012 acquisition and lease of Bombardier CRJ1000 regional aircraft by Garuda.
Bombardier, which has undergone several changes of leadership after costly industrial bets in the past decade, said the SFO was investigating the same transactions that led to the former CEO of Garuda Indonesia being convicted in May.
An Indonesian court in May handed Emirsyah Satar, Garuda chief executive from 2005 to 2014, an eight-year jail sentence for bribery and money-laundering related to procurement of planes and engines from Airbus <AIR.PA> and Rolls-Royce <RR.L>.
In 2017, Rolls-Royce agreed to pay more than $800 million (£609 million) to defer charges after an investigation by the SFO and U.S. Justice Department into alleged bribery of officials in six countries.
Airbus in February agreed to pay a record $4 billion in fines after reaching a plea bargain with prosecutors in Britain, France and United States over alleged bribery and corruption stretching back at least 15 years.
SFO APPROACHED BOMBARDIER
Under a system of deferred prosecution agreements available to the SFO, companies may be offered the chance to settle cases with a fine and escape corporate criminal charges by helping to investigate themselves and undergoing radical interal changes.
Bombardier Chief Executive Eric Martel, who started his role in April, told reporters the SFO had reached out to the Canadian company a few weeks ago.
"We were not aware of any issue internally," he said.
Companies can win credit for bringing potential wrongdoing to the attention of authorities themselves, though Rolls-Royce avoided a larger fine by showing what a judge described as "extraordinary" co-operation after being approached by the SFO.
Airbus has undergone a radical overhaul of its top ranks since reporting itself to the SFO in 2016. The four-year probe however weighed on sales and relationships with airlines and led to in-fighting over who should carry the blame for using agents.
Bombardier has already undergone significant upheaval since 2015 while trying to bring a larger narrowbody jet to market.
It completed an exit from commercial aviation this year by completing the sale of its money-losing regional jet business to Japan’s Mitsubishi Heavy Industries to focus on more profitable business jets.
(Reporting by Yadarisa Shabong in Bengaluru, Kirstin Ridley in London, Allison Lampert in Montreal, Tim Hepher in Paris; Writing by KirstinRidley and Tim Hpher; Editing by Sriraj Kalluvila, Emelia Sithole-Matarise and David Gregorio)