Who Knew What, When?

The investigation over alleged insider trading at Airbus parent company EADS continues. On Wednesday, the company's French co-chairman, Arnaud Lagargere, was reportedly questioned for nine hours by financial regulators.

Citing French press reports, the International Herald Tribune also stated EADS co-CEOs Louis Gallois and Thomas Enders were questioned by French senators, as part of their own inquiry into questionable stock sales, that may-or-may-not have been related to production delays with the Airbus A380.

As Aero-News reported, former EADS co-CEO Noel Forgeard became embroiled in allegations of fraud, after he and other executives with the European aerospace consortium sold off significant shares of EADS stock in March 2006, two months ahead of the public announcement of a second major delay to the A380 program.

At first, Forgeard stood defiant to those charges... but he later resigned due to the scandal. In the year since, both the German and French governments have looked into the fact the executives got out at just the right time, and made money -- Forgeard netted $3.1 million. A lot of investors rode the wreckage all the way down, though, and saw their shares in EADS fall over 25-percent from pre-delay levels.

Things aren't much better today, either, as the markets nervously await word on who among the EADS board knew what, and when, about the A380 delays. Prices fell another 1.16 percent Wednesday, to just over $31 per share in EADS.

Lagardere, a French media mogul whose company holds 15 percent interest in EADS, told the AMF earlier this year he had no idea about the delays until the news broke publicly. He has also encouraged the investigatory agency to investigate the questionable stock sales.

One of the participants on the Senate's economic affairs committee, Senator Jean-François Le Grand, said the hearing would contribute to a report not only on the situation but also an outlook for EADS and was due to be published in late June, according to Forbes.

On Tuesday, EADS and Airbus denied a La Tribune report, alleging Airbus Technical Director Alain Garcia told board members about the production delay affecting the A380 -- Airbus' flagship program, and its most visible -- on March 7, 2006... the same day executives began dumping shares.

FMI: www.eads.com