The Frankfurt-based German Federal Securities Supervisory Office (BaWe) has said that it has begun formal investigations into alleged insider trading at Kinowelt.
The move comes after shares in Kinowelt, listed on the Nemax50 blue-chip segment of Germany's Neuer Markt, lost some 40% of their value in the three days ahead of an announcement on March 23 that the company had failed to meet 2000 earnings targets.
"We have launched a formal insider trading probe related to Kinowelt," a BaWe spokeswoman said.
A Kinowelt spokesperson told Screen International that it believed its stock had suffered as a result of negative analyst comment about the company's earnings prospects.
In a statement issued by the members of the executive board - Dr Michael Kölmel, Dr Rainer Kölmel and Eduard Unzeitig - they categorically state that neither they nor members of their families sold shares in the run-up to the ad hoc announcement of 23 March 2001 and neither did they pass on any insider information prior to its publication.According to the statement, the executive board will immediately make available any documentation and information necessary to help bring the enquiry to a rapid conclusion.
Kinowelt's share price fell 9% to Euros3.56 yesterday (June 6). On Monday (June 4), Kinowelt posted an unexpectedly large first-quarter loss before interest and tax (EBIT) of Euros30.3m and halved its full-year forecast.