FINANCIAL TIMES: FSA to look at AI share movements: “Over recent months, the FSA has taken a more aggressive approach to irregularities, publicising more frequently when it is formally investigating companies, and fining miscreants. In December, it announced its biggest fine against an individual - £290,000 from entrepreneur and former investment banker Robert Bonnier; and in August its biggest fine against a company - £17m from Shell.” (ShellNews.net) 14 Jan 05
By Lucy Smy in London and Haig Simonian in Zurich
Published: January 14 2005
The Financial Services Authority has confirmed it is examining the unusual share price movements of Aggregate Industries in the days leading up to Wednesday's proposed bid by Holcim, the Swiss cement giant, for the company.
Although the regulator has yet to launch an official investigation, it made clear yesterday that in any situations where unusual share price movements were found to have a suspicious provenance, further action would be taken.
Holcim first looked acquisitively at AI in November but did not contact the company directly until Monday evening. Then the Swiss company told AI it had board approval to make a cash bid, which it hoped AI would find interesting.
Talks took place on Tuesday and an announcement about the prospective bid of £1.8bn was made on Wednesday.
The volume of shares in AI traded on Monday was triple that of the previous Friday and the volume traded on Tuesday was nearly four times Monday's level.
The surge in trading on Tuesday, which also led to a 4p share price rise to 114p, was sufficient to start news reports of bid speculation.
Over recent months, the FSA has taken a more aggressive approach to irregularities, publicising more frequently when it is formally investigating companies, and fining miscreants.
In December, it announced its biggest fine against an individual - £290,000 from entrepreneur and former investment banker Robert Bonnier; and in August its biggest fine against a company - £17m from Shell.
Meanwhile, Swiss analysts yesterday appeared to have warmed towards Holcim's proposed offer for AI.
Research notes from a number of banks pointed out the potential benefits for Holcim of greater vertical integration and closer contacts with end customers.
But Goldman Sachs remained hostile to the deal, warning in a morning note that the proposal represented a step away from Holcim's widely praised emerging markets concentration. Deutsche Bank downgraded the stock.
Holcim shares were up slightly yesterday at SFr69.55 in a marginally stronger Swiss market. AI shares closed down ½p at 139½p.
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