Press scathing on EADS insider trading allegations
4 October 2007, PARIS (AFP) - The French press was scathing in commentary Thursday on insider trading charges at aerospace giant EADS, maintaining that the French government was also implicated in an affair that one paper called "revolting."
4 October 2007
PARIS (AFP) - The French press was scathing in commentary Thursday on insider trading charges at aerospace giant EADS, maintaining that the French government was also implicated in an affair that one paper called "revolting."
Commentators said the scandal was all the more disturbing because the allegations of massive illegal stock deals by EADS executives came as thousands of EADS workers were in the process of losing their jobs under a restructuring.
"One can easily understand the disarray among the workers," who have been "subjected to a painful -- though necessary -- restructuring, when they consider what was going on here and there at company management level," wrote Gaetan de Capelle in Le Figaro.
Jean-Paul Pierot in the Communist Party newspaper L'Humanite wrote: "The scandal is especially revolting because at a time when we learn that certain well-informed people were lining their pockets, thousands of workers, technicians, engineers at Airbus and its sub-contractors are going to see their jobs eliminated and production sites sold off to private interests."
EADS, the parent company of troubled planemaker Airbus, is carrying out a sweeping overhaul at the manufacturer that will see the suppression of 10,000 posts.
EADS, the European Aeronautic Defence and Space Company, was rocked Wednesday on reports by Le Figaro and a knowledgeable source that around 20 EADS executives and shareholders had allegedly sold their stakes in the company knowing that it was about to disclose big problems at Airbus.
The reported illegal selling, according to Le Figaro, took place between November 2005 and March 2006. EADS in mid-June last year announced major production and delivery delays at Airbus that sparked a collapse in the parent company's share price.
A souce close to the matter told AFP Wednesday that the French market regulator AMF had provided the public prosecutor with a report on insider trading at EADS, which according to Le Figaro has been delivered to a judge investigating the allegations.
The newspaper also maintained that the French finance ministry had been aware of problems at EADS but allowed one of the company's key shareholders, French media and defense company Lagardere, to go ahead with its sharesale.
The French state is also a shareholder in EADS while the German government is represented by a consortium of investors and regional German states.
The French finance minister at the time, Thierry Breton, insisted that the state's conduct had been "irreproachable" and the current minister, Christine Lagarde, asserted that that the state had "never sold a single share."
Writing in La Tribune, Pascal Aubert said "all the ingredients are in place to become a state affair," noting that EADS "above all is a political construction and that nothing that happens there or is decided is unknown to French and German authorities."
Patrick Lamm of Les Echos said that while the French government had not sold its shares, the state "is not above suspicion" because once having been "informed of the problems at Airbus, it did not signal an alert, which its responsibilities as a shareholder should have led it to do."
Despite the controversy EADS shares gained ground in morning trading here, rising 1.01 percent to 21.93 euros on comments from JP Morgan that Airbus orders this year should jump to 2,600 planes from 1,900 in 2005.
Subject: French news