French police detain ex-Eads head

Fraud squad question former aerospace chief executive over insider dealing allegations.

     Forgeard arrives at the Paris offices of
    France's financial fraud squad [AFP]
    Under French law, Forgeard can be held for up to 48 hours after which, if police decide to pursue the matter, a magistrate could place him under formal investigation.
     
    Boardroom shake-up

     

    Forgeard has repeatedly protested that he was unaware of the depth of the A380 production problems when he sold large amounts of the Eads shares in 2006.

    The sales were reported at the time to stock market authorities.

    The revelations of the extent and depth of the A380 problems threw Eads and its Airbus aircraft unit into crisis in the middle of 2006 and the company's share price fell sharply.

    The losses led to a boardroom shake-up and restructuring at Airbus which is projected to eventually lead to the loss of 10,000 jobs.

    Forgeard resigned as chief executive of Eads on July 2, 2006, and was replaced by Christian Streiff.

    Financial regulator

    To date, no one has been placed under formal investigation by judges Xaviere Simeoni and Cecile Pendaries.

    In April, AMF, the French financial market regulator, said it had found evidence of possible insider trading on the part of 17 Eads executives as well as the group's principal shareholders, Lagardere and Daimler.

    Reports at the time said Forgeard was among those named by the AMF.

    An adviser to Jacques Chirac, France's former president, Forgeard had relied partly on the French leader's backing to wage, and win, a fierce leadership struggle at the European aerospace group that saw him named co-head in 2005.

    Before joining Eads, Forgeard spent seven years at the helm of Airbus where he was credited with winning market leadership from Boeing, the US aeroplane manufacturer.

    SOURCE: Agencies


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