Airbus shaken by stock probe

PARIS -- Just as Airbus began selling its oft-delayed superjumbo as a success story, a report of "massive insider trading" at parent company EADS was leaked to the media Wednesday -- raising the question of whether the beleaguered company can ever get ahead of its problems.

The preliminary report by the stock market regulator, suggesting that EADS executives sold shares and exercised stock options after learning about significant delays to the A380, came less than two weeks before a glitzy ceremony marking the delivery of the first superjumbo to Singapore Airlines.

EADS Chief Executive Louis Gallois, who did not sell shares at the time, tried to downplay the findings, which judicial officials said Wednesday had been delivered to the prosecutor's office.

Gallois said his job is to ensure that managers aren't distracted by the negative publicity and get on with the job of competing with U.S. rival Boeing Co., based in Chicago, and selling planes.

The Financial Markets Authority, or AMF, has been investigating for more than a year how much executives and board members knew about profit-damaging delays to the A380 superjumbo when they sold shares or exercised stock options worth several million euros between November 2005 and March 2006.

French daily Le Figaro, which claimed to have seen the AMF's preliminary report, said the problems linked to the A380 and the mid-range A350 were raised in an EADS board meeting as early as July 2005.

The public announcement about the AMF probe came in June 2006, sending EADS shares crashing 26 percent in one day.

Gallois, who was appointed to head Airbus after the suspected problems, refused Wednesday to comment on the contents of the AMF report, noting only that it is preliminary. He took over as sole EADS CEO in August in a management overhaul designed to end national rivalries.

Airbus and EADS have been shaken over the past year and a half by management strife, the insider trading accusations and the strong euro, which hurts revenue from plane sales as they are priced in dollars.