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Tuesday, February 12, 2013

Finmeccanica CEO Orsi Arrested Over Corruption Allegations

By Andrew Drwiega

Italian Police have arrested Giuseppe Orsi, Finmeccanica’s chief executive and chairman who was previously CEO of AgustaWestland, over allegations of bribery concerning an Indian helicopter contract. He denies any wrongdoing.

The case being investigated involves the sale of 12 AW101s to the Indian Air Force for VVIP transportation. The contract for the aircraft, valued at around €560 million (approximately $750 million), included five years of logistics support together with initial crew and technician training.

 

Guiseppe Orsi in a corporate bio photo from Finmeccanica.

 

AgustaWestland has delivered three of the helicopters already with the full order expected for completion by the end of 2013. This breaking news follows Finmeccanica’s participation in the Aero India airshow in Bangalore, India, last week.

Current AgustaWestland chief Bruno Spagnolini and two others are reported to be under house arrest.

A statement issued today by Italian organization read: “Finmeccanica expresses support for its Chairman and CEO, with the hope that clarity is established quickly, whilst reaffirming its confidence in the Judges.”

In September last year, the organization issued a statement following media stories connecting the company with an investigation: “Finmeccanica and AgustaWestland, while highlighting that the notification of investigation is a deed usually sent during any inquiry, declare that they are not involved in the alleged charges.”

 

Current AgustaWestland CEO Spagnolini (left) with Geoff Hoon, former UK Secretary of Defense and current head of international business development at AgustaWestland, at the company's Farnborough 2012 press conference.

 

Italian Prime Minister Mario Monti, in an interview with RAI state television, stated that the Italian government would be addressing management issues at the company: “There is a problem with the governance of Finmeccanica at the moment and we will face up to it.”

Finmeccanica is 30.2 percent owned by the Italian government, with the remaining 46 percent of shares owned by Italian and international institutional investors, with a smaller 23.8 percent shares owned by private investors.

Reports state that the Indian defense ministry has asked the Central Bureau of Investigation to examine the allegations.

Related: Airframe News

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