The Israel Securities Authority is investigating a senior executive of carbonated drinks manufacturer Sodastream International Ltd. on suspicion of committing insider trading violations regarding the home carbonated drinks company's acquisition by PepsiCo Inc. A senior executive and close associate were questioned today and brought before the Tel Aviv Magistrates Court to discuss the terms of their release. Their names have not been released for publication.
The executive and associate are suspected of breach of trust, insider information offenses and impeding legal enquiries. The Israel Securities Authority suspects that the senior Sodastream executive passed on information to the associate who acquired shares in the company prior to PepsiCo's acquisition.
Last December, PepsiCo completed the acquisition of Sodstream for $3.2 billion at $144 per share, an 11% premium on the Nasdaq and TASE share price, prior to the announcement about the acquisition. The shares have since been delisted.
The alleged insider information that was illegally passed on concerned the companies positive financial results published on August 1 2018 for the second quarter of 2018 and the report of August 20 2018 about the acquisition by PepsiCo, which saw the share price rise sharply.
The Sodastream executive's associate reportedly bought shares worth hundreds of thousands of shekels using this information and made an overall profit of NIS 156,000. The same associate is also suspected of buying shares prior to publication of the 2016 financial results on February 15, 2017. On that occasion the suspect made a profit of NIS 28,000.
The suspects must be presumed innocent as they have not yet been convicted of any offenses.
Published by Globes, Israel business news - en.globes.co.il - on September 23, 2019
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