Daimler hit with EADS insider trading charges

Daimler hit with EADS insider trading charges
Photo: DPA
French judges have charged the German auto giant Daimler in an insider trading scandal centring on the European defence group EADS, a judicial official said Thursday.

Investigating judges are charging Daimler, a key shareholder in the European Aeronautic Defence and Space Company (EADS), with insider trading in a high-profile case relating to the sale of EADS shares in 2005 and 2006, the official, who asked not to be named, told news agency AFP.

Daimler called the charges “very unusual” and “hardly comprehensible.”

Daimler sold a 7.5 percent stake of EADS in April 2006. Two months later the group’s star company, plane maker Airbus, announced a major delay to deliveries of its A380 passenger jet, which dragged EADS share prices down.

Major French media and defence company Lagardere has also been charged in the case after selling a 7.5 percent stake in EADS at the same time.

Former EADS co-chairman Noel Forgeard and senior Airbus executive John Leahy are among several top managers charged in the scandal which broke in 2008. They have denied any wrongdoing.

Forgeard stepped down in July 2006 amid mounting pressure over the A380 delays and his decision to exercise share options earlier in the year.

On Thursday, Daimler noted that the French financial markets watchdog, the Autorité des marchés financiers, had looked into the matter regarding EADS early last year and found the German group had committed no violations.

Daimler said it was “confident this affair will also have a favourable outcome” for the group.

Daimler, owner of Mercedes Benz, makes luxury cars and is the world leader in heavy truck manufacturing.

In Berlin Wednesday, the government said it would host a meeting on the future of EADS on February 23, amid reports that Daimler wanted to sell its remaining 15 percent stake.

Daimler holds 15 percent of EADS and 22.5 percent of its voting rights, but appears to be preparing its exit.

The firm could even get rid of its holdings this year, the Financial Times Deutschland has reported.

AFP/The Local/adn

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