P.M. BRIEFING : Swiss Probe Possible Insider Trading in Suchard Takeover

Swiss authorities today began a preliminary investigation to determine whether news of the $3.8-billion takeover of the Swiss chocolate and coffee group Jacobs Suchard by Philip Morris Cos. Inc. may have been leaked.

Zurich Dist. Atty. Rudolf Unterrassner said “intensive clarification” is under way to see whether media reports hinting at possible insider trading of Jacobs Suchard shares can be corroborated. Insider trading became a criminal offense in Switzerland two years ago.

Unterrassner said the Zurich Stock Exchange has been asked to supply records allowing investigators to analyze the share price movements. Urs Bruegger, chief legal officer of the Zurich Exchange, said there were “certain unclear elements” but that there was no concrete evidence of a violation.

Jacobs Suchard had ordered an internal probe already on Friday after details of the deal were published in newspapers on the eve of its announcement.

Rumors of a possible takeover of Jacobs Suchard had been circulating for weeks. The Zurich financial newspaper Finanz und Wirtschaft noted in its Saturday edition that the volume of trade in Jacobs Suchard shares quadrupled from May 15 to May 18, well before the rumors were reported.