Thales denies wrongdoing as bribery probe hits shares

French defence and technology firm Thales is denying allegations brought to its attention after Britain's Serious Fraud Office announced a joint investigation with French authorities into suspected bribery and corruption. Thales, Europe's largest defence technology firm, said the probe by the SFO and France's PNF financial prosecutor concerned a contract in Asia and focused on four entities in France and the UK, without giving further details. "Thales denies the allegations brought to its knowledge," the company said in a statement on Friday. It did not give any further details of the allegations or say when it first learned of them, or how. It also did not say whether it was conducting its own internal probe. The company said in a recent corporate report that it has "zero tolerance" of corruption. Shares in partially state-owned Thales fell as much as seven per cent but recovered most of the losses to end the day down 2.9 per cent. A Thales spokesperson said the company was co-operating with the authorities in the investigation and always complied with national and international laws. A French judicial source told Reuters earlier that the probe related to an arms contract in Asia, centred on possible charges of bribery of a foreign public official, influence trafficking, handling stolen goods and money laundering. Two people familiar with the case said it at least partially involved a business deal in Indonesia. Indonesia's Defence Ministry told Reuters in a message late on Saturday that it was aware of news of the investigation. A ministry spokesman said all Thales contracts with the ministry and the country's defence industry follow rules of transparency, accountability and good governance, and the ministry has not seen any indication of those contracts breaking any law. The SFO declined any comment beyond its late Thursday announcement. "At this point, the related contract under investigation remains unknown, making any potential assessment of the risk challenging," Jefferies analysts said in a note. Thales' military and civil products range from sub-hunting sonars to biometric identity systems for banks, and from satellites to seat-back entertainment systems for airlines. It also provides cybersecurity services, radar for French Rafale warplanes and is involved in two satellite ventures with Italian aerospace group Leonardo. Thales Australia is a subsidiary of the French conglomerate and a partner of the Australian Defence Force and employs more than 4000 Australians.