Insider-trading claim about Airbus parent firm is leaked
paris -- Just as Airbus began selling its often-delayed super-jumbo jet as a success story, a report of “massive insider trading” at parent company EADS was leaked to the media Wednesday, raising the question of whether the beleaguered company can ever get ahead of its problems.
The preliminary report by the French stock market regulator, suggesting that EADS executives sold shares and exercised stock options after learning of significant delays to the A380, came less than two weeks before a glitzy ceremony marking the delivery of the first super-jumbo jet to Singapore Airlines.
EADS Chief Executive Louis Gallois, who did not sell shares at the time, tried to downplay the findings, which judicial officials said Wednesday had been delivered to the prosecutor’s office.
Gallois said his job was to ensure that managers were not distracted by the negative publicity and got on with the job of competing with U.S. rival Boeing Co. and selling airplanes.
“We are entering the period of convalescence,” he said Wednesday during a debate on relations behind the Franco-German consortium that runs European Aeronautic Defense & Space Co. “I would prefer that they talked about us for other subjects . . . but it is not me who makes the news.”
EADS said in a statement that it was “most surprised” by the leaked reports, which it considers “an unlawful violation of the confidentiality of the current investigations and of the principle of the presumption of innocence.”
The Financial Markets Authority has been investigating for more than a year how much executives and board members knew about profit-damaging delays to the A380 when they sold shares or exercised stock options worth several million euros between November 2005 and March 2006.
French daily Le Figaro, which claimed to have seen the authority’s preliminary report, said the problems linked to the A380 and the mid-range A350 were raised in an EADS board meeting as early as July 2005.
The public announcement about the regulatory probe came in June 2006, sending EADS shares crashing 26% in one day.
Airbus and EADS have been shaken over the last year and a half by management strife, the insider-trading accusations and the strong euro, which hurts revenue from plane sales as they are priced in dollars.
The Toulouse, France-based company has been ceding its position as the world’s dominant plane maker to Boeing and foresees thousands of job losses and factory closures. The world’s largest plane is two years late because of wiring difficulties and communication failures between Airbus plants in Germany and France.
