The FSA’s crusade to clean up the City continues apace, with the regulator charging a finance director and two lawyers with eight counts of insider dealing.
From a statement issued on Tuesday afternoon.
Andrew King, a finance director, and Michael Mcfall and Andrew Rimmington, both lawyers, appeared today at City of Westminster Magistrates’ Court .
Andrew King is charged with: Disclosing inside information relating to the proposed takeover of Neutec Pharma plc (the “inside information”) to Michael McFall, having had that inside information by virtue of being Neutec Pharma plc’s finance director, and disclosing it to Michael McFall other than in the proper performance of his job.
Michael McFall is charged with: Disclosing the inside information to Andrew Rimmington; and on three separate occasions, acquiring a total of 3955 shares in Neutec Pharma plc on the basis of the inside information.
Andrew Rimmington is charged with: on three separate occasions, acquiring a total of 6961 shares in Neutec Pharma plc on the basis of the inside information.
Michael McFall and Andrew Rimmington are charged jointly with: acquiring 3012 shares in Neutec Pharma plc on the basis of the inside information.
Now, 14,000 shares may not sound a lot, until the price and premium offered by the bidder – Novartis – is considered.
Here’s how the FT reported the deal in June 2006.
Novartis, the Swiss pharmaceutical group, said on Wednesday that it would acquired Neutec Pharma, the Manchester-based biotechnology company, in a deal valued at GBP305m, or GBP10.50 a share.
The bid price, which is more than double Neutec’s share price of 502.75p on Monday, reflects the heady multiples seen in recent deals between biotechnology groups and big pharmaceutical companies. It also reflects Neutec’s late-stage drug portfolio.
Yep, a 100% premium, something that was rare even back in the boom times.
Proceedings against the three men have been adjourned until July 28 when Magistrates will consider committal to the Crown Court for trial. The accused have been granted unconditional bail.
Related link:
The FSA guide to insider dealing – FT Alphaville
FSA launches insider trading prosecution – FT
Blue Index punished in FSA probe – FT