Insider trading alleged at EADS

Several executives of Airbus’ parent company accused of illegal share dealings.

Individuals allegedly sold EADS shares before delays to the A380 were made public [GALLO/GETTY]
Individuals allegedly sold EADS shares before delays to the A380 were made public [GALLO/GETTY]
The AMF confirmed later on Wednesday that it had sent the public prosecutor a note on possible insider trading at EADS, but did not release further details.
Individuals investigated
The judicial investigation was opened in November 2006 in response to complaints, notably from Appac, an association of small French shareholders.
Xaviere Simeoni, investigating judge, and another judge have since ordered searches to be carried out at the headquarters of EADS.
Lagardere, a French media and defence company and a principal shareholder of EADS, is also understood to be under investigation.

Airbus is due to roll out its flagship A380
aircraft later this month [GETTY IMAGES]

Le Figaro

said the preliminary report found a total of 1,200 alleged cases of insider trading, but the regulator decided to focus on 21 individuals, including EADS and Airbus executives and key shareholders.
The newspaper said the AMF report cited Noel Forgeard, a former Airbus chief executive and EADS co-chief executive, who resigned in July last year amid a scandal over the timing of share dealings and delays in the production of the A380.
Thomas Enders, current head of Airbus, and a number of other directors, past and present, were also named.
The AMF report was reported as describing the alleged share sell-off between November 2005 and March 2006, as “simultaneous and massive” in scale.
The regulator said problems in the A380 programme had been mentioned as early as June 2005 at an EADS board meeting – nine months before the issues were made public.
The major industrial shareholders of EADS, DaimlerChrysler, the German car maker and Lagardere, each sold 7.5 per cent of their holdings in April 2006 for $2.8bn.
Legal action
Shares in EADS fell 26 per cent on June 14 that year after the second warning by Airbus about delays to A380 deliveries.
Lagardere said on Wednesday it would launch legal action for damages caused by “interpretations” of a preliminary AMF document that had led to “unfounded accusations.”
EADS criticised on Wednesday “an unlawful violation of the confidentiality of the current investigations and of the principle of the presumption of innocence”.
Le Figaro said the AMF report also alleged that the French government had been made aware of difficulties at EADS before the public announcements by the company.
Facing questions in parliament on Wednesday, Christine Lagarde, economy minister, denied any insider trading by the previous government, saying the state “never sold a single share”.
Source : News Agencies

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