Autoblog

Insider trading ahead of Hyundai-Kia MPG debacle suspected

Seyth Miersma — Fri, 21 Dec 2012 17:44:00 EST

Filed under: Government/Legal, Hyundai, Kia, Earnings/Financials

Reuters is reporting that large-scale insider trading may be at the heart of some particularly fishy stock-selling behavior, just prior to the original announcement about the Hyundai-Kia fuel economy ratings debacle.

On November 1st,Hyundai-Kia shares traded roughly 2.2 million times (the single highest-volume day of the year), and the stock price fell by about four percent. For reference, a standard daily trading volume for the stock in 2012 saw about 600k shares trading hands. On November 2nd, the company made public the bad news about the dropping fuel economy ratings for many of its models. In other words: No one outside of the company (and only a smallish group inside the company, we'd imagine) should have known anything about the impending bad news as of the first day of November. After the announcement, the stock price tanked, as you'd expect, and trading volume was way down as well.

Experts seem fully aware that the whole thing reeks of leaked information and subsequent insider trading. If chicanery on this sort of scale seems wacky to you, you'd be inline with the experts who report to Reuters that the level of trading is absolutely suspicious.

The problem is, it seems, that this kind of market reaction is far from uncommon in Asia, especially. Research points out that 26 percent of price-sensitive announcements in the Asia Pacific region showed some hint of information leakage, just in the first quarter of this year. That figure is roughly double what is expected in North American markets; due in some significant part to much less stringent enforcement of insider trading regulations in Asia, as well as an established culture that doesn't necessarily see the behavior as criminal.

Insider trading ahead of Hyundai-Kia MPG debacle suspected originally appeared on Autoblog on Fri, 21 Dec 2012 17:44:00 EST. Please see our terms for use of feeds.

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Former Porsche CEO Wiedeking indicted over VW takeover bid

George Kennedy — Thu, 20 Dec 2012 14:16:00 EST

Filed under: Europe, Government/Legal, Hirings/Firings/Layoffs, Porsche, Volkswagen, Earnings/Financials

Do you recall the failed efforts by Porsche to take over Volkswagen? According to a Bloomberg report, former Porsche CEO Wendelin Wiedeking (above) and ex-CFO Holger Haerter have finally been charged with market manipulation over the exercising of options as part of the German sportscar manufacturer's ill-fated attempt to take over the much larger VW. That failed bid eventually resulted in the reverse coming true - VW swallowing Porsche.

The charges leveled by Stuttgart prosecutors come after a three-year investigation centered around allegations that Porsche execs made a concerted effort to increase the company's share in VW to 75 percent in preparation for a hostile takeover. Porsche had previously told its investors on at least five occasions that it had no intention to buy VW.

Portions of the investigation have subsided, according to prosecutors, citing an inability to prove certain improprieties with a "necessary degree of certainty." The number of charges is down to 5 from a previous 14 counts regarding "information-based market manipulation."

For its part, Porsche has been quick to point out that the investigation centers around two men who are no longer with the company - Weideking and Haerter stepped down in July of 2009.

Former Porsche CEO Wiedeking indicted over VW takeover bid originally appeared on Autoblog on Thu, 20 Dec 2012 14:16:00 EST. Please see our terms for use of feeds.

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BREAKING: Porsche offices raided on suspicion of stock manipulation

Chris Paukert — Thu, 20 Aug 2009 12:56:00 EST

Filed under: Government/Legal, Hirings/Firings/Layoffs, Porsche, Volkswagen

The soap opera surrounding Volkswagen AG and Porsche has just taken a turn for the legal, as Bloomberg reports that the company's German offices have been raided by prosecutors who are investigating whether the automaker has violated security laws.

The German prosecutor's office seized documents amidst the allegations of stock price manipulation and insider trading, prompting Porsche to issue a statement denying the allegations while vowing complete cooperation (available after the jump). The probe stems from the sports car maker's attempt to gain control of parent Volkswagen, and the investigation is reportedly focusing on recently departed CEO Wendelin Wiedeking as well as ex-CFO Holger Haerter.

As you may recall, Porsche had tried to take over VW back in May, but that maneuver failed because of the company's swirling debt and a veto on the action by Lower Saxony. Porsche has since been swallowed up by the very company it was once seeking to take over, with an additional stake going to Qatar investors. You can read more by clicking on the link below, but be sure to hit the jump to read Porsche's official statement.

Gallery: 2010 Porsche Panamera

[Sources: Bloomberg, Porsche | Image: David Hecker/AFP/Getty]]

Continue reading BREAKING: Porsche offices raided on suspicion of stock manipulation

BREAKING: Porsche offices raided on suspicion of stock manipulation originally appeared on Autoblog on Thu, 20 Aug 2009 12:56:00 EST. Please see our terms for use of feeds.

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