Insider-Trading Accusation
October 31, 2007
Airbus chief Thomas Enders filed a complaint against unknown persons with the Paris prosecutor following the publication of press articles related to the case, the Financial Times Deutschland said Wednesday, Oct. 31, on its Internet site, quoting an EADS spokesman.
The action followed a similar one filed "a few days earlier" by the European Aeronautic Defense and Space Company itself, the newspaper said.
"Mr. Enders has the full support of EADS," it quoted the company spokesman as saying.
Selling before shares plunged
French and German judicial authorities are investigating possible insider trading of EADS shares in late 2005 and early 2006 before it emerged that Airbus would have to delay deliveries of its flagship A380 superjumbo jet.
News of the delays on June 13, 2006 caused EADS shares to plunge by more than 26 percent the following day.
France's Le Monde newspaper reported Saturday that the French stock market regulator AMF decided to widen the probe into alleged insider dealing at EADS to examine whether the European consortium had deliberately put out "misleading information" to the stock market.
In early October, the French newspaper Le Figaro revealed that the AMF was investigating the sales of EADS shares prior to June 13.
A "preliminary note" sent to the Paris prosecutor's office indicates suspicion that around 20 EADS directors, along with two core shareholders -- the French media and defense group Lagardere, and German automaker Daimler -- might be involved in the trading scandal.
The preliminary report mentions "massive insider trading" by EADS directors, but the final AMF report is not expected until early next year.
Enders decries "criminal" treatment
Lagardere has already said it would file a complaint following the newspaper publication to obtain compensation because it charged that terms of the report had led to "interpretations (in the media) which led to unfounded accusations."
Enders, who was co-president of EADS in June 2006, said a few days after the report in Le Figaro that he felt he had been "treated like a criminal" and "stigmatized" by "unfounded criticism."
In a letter to Airbus employees, Enders claimed his innocence.
According to the Financial Times Deutschland, which quoted sources close to EADS's aerospace unit, "other managers" are considering following Enders's lead.
An EADS spokesman on Monday told Reuters that the company was fully cooperating with the AMF and said EADS's corporate communications had been legally appropriate. Directors against whom allegations have been made have denied any involvement in insider trading.