Reebock Vice President Agrees to Insider Trading Settlement

An executive of Reebok International Ltd., an athletic footwear company based in Canton, Mass., settled insider trading charges Friday by agreeing to surrender profits and pay a penalty.

The Securities and Exchange Commission, in a complaint filed in U.S. District Court in Boston, accused Robert Slattery, a division vice president of Reebok, of profiting by misusing privileged, non-public information in Reebok’s acquisition of another footwear firm, Avia Group International Inc., based in Portland, Ore.

Without admitting or denying the charges, Slattery agreed to disgorge $11,130 in profits and pay an equal sum in penalties.

Charges Detailed

The SEC said that on Feb. 11, 1987, Slattery purchased 1,000 shares in Avia for $19 each. Shortly after that, he learned that Reebok planned to acquire Avia for about $16 a share.

When Reebok announced the acquisition at $16.35 a share on March 10, Avia stock plunged from $27.50 to $16.50. A day earlier, Slattery had sold his Avia stock for about $26 a share, avoiding a loss of $9,209, the agency alleged.

It also said that on the day before the announcement, Slattery purchased 20 options on Reebok stock, which was trading at $37.37 share, allowing him to buy it later in March and April at $40 a share. Following the announcement, the Reebok price went to $41.62 and Slattery profited by $1,920, the SEC said.

Reebok officials did not immediately return telephone calls for comment.