Bombardier stock plummets on probe of insider trades
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Canadian planes and trains manufacturer Bombardier's stock price tumbled Friday after Quebec's securities regulator announced it was probing executives' stock trades.
At the close on the Toronto stock exchange, it had fallen more than 20 percent to finish the week at Can$1.67.
Investors reacted badly after the province's financial markets regulator, the AMF, announced late Thursday it was looking into the company's creation on August 15 of an Automatic Securities Disposition Plan (ASDP).
ADSPs allow executives with insider knowledge to sell their stock at arms-length on a predetermined schedule, as long as they don't have undisclosed material information.
At the regulator's request, the company suspended all sales of securities under the plan "until further notice."
Bombardier said it "fully intends to cooperate with the AMF in its review."
It noted also that the plan had been reviewed by the AMF prior to its establishment.
Local media said the securities regulator was investigating whether Bombardier executives had implemented the stock plan knowing a restructuring would be announced three months later.
"The regulator will have to determine whether, with the information they had that was not available to the public, Bombardier executives committed insider trading," said Montreal's La Presse newspaper.
The struggling manufacturer last week announced the sale of its aging Q Series turboprop line to a Canadian investment fund, and worldwide cuts of 5,000 engineering jobs.
After the divestiture -- which followed its sale of a majority stake in its CSeries jetliner line to Airbus in July -- questions were raised about Bombardier's future as an aeronautics firm, as it was left with only regional aircraft and business jet lines.
© 2018 AFP