German public engineering company ZF Friedrichshafen AG is reviewing its business ties with South Korean business man Chung Eui Sung who is linked to an investigation into diesel engine maker Tognum AG (TGM.XE) over compliance rule breaches.

"Just like many other companies, ZF Friedrichshafen has business relationships with Chung Eui Sung's companies," the company said in an email statement.

ZF Friedrichshafen has so far found no evidence of irregularities in connection with payments to South Korean companies, it added. A ZF spokesman declined to provide further details.

Tognum, a subsidiary of Daimler AG (DAI.XE) and Rolls-Royce PLC (RR.LN) has been under investigation by German public prosecutors for the past three weeks over allegations of compliance rule breaches and bribery. According to prosecutors, the allegations relate to suspicious payments in the million-euro range in South Korea for defense-related goods.

The probe led to the resignation of Togum executive board member Peter Kneipp and the company pledged it would clarify any further possible breaches of compliance.

In particular, prosecutors are looking into provisions paid by Tognum's MTU Asia division to sales agents in South Korea between 2000 and March 2011 worth EUR26.7 million. Additionally, prosecutors are looking into payments worth around EUR160,000 made to South Korean army staff between 2000 and 2007.

Industrial giant ThyssenKrupp AG (TKA.XE) and MAN SE's (MAN.XE) Renk division have also said they are internally investigating business ties to Chung Eui Sung's company, UBMTECH Ltd.

-By Nico Schmidt, Dow Jones Newswires; +49 69 2972 5507; nico.schmidt@dowjones.com

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