LONDON Feb 25 British defence supplier Cobham
said it had voluntarily informed the U.S. Department of
Justice (DOJ) of an internal investigation into potentially
irregular practices in the sale to Asia of products made by a
The company said on Tuesday that the products were made by
Florida-based TracStar Systems Inc., part of Cobham's SATCOM arm
that makes, sells and supports satellite and radio communication
The company was alerted to the issue over the past week by
an employee and the DOJ will conduct further investigations with
which the company would cooperate, said Cobham spokesman Greg
"It would be premature to provide additional detail on the
investigation as it is now ongoing," he said. "Investigations of
this sort could take several months and we will update the
market as appropriate."
At 1148 GMT, shares in Cobham were 2 percent lower at 289
pence against a FTSE 250 index down 0.45 percent.
Cobham bought TracStar, whose products include satellite
tracking systems used by governments and commercial customers,
TracStar's worldwide revenue in 2012 was under 15 million
pounds, or less than 1 percent of Cobham's group revenue that
year, the company said.
"We understand this is not systemic and won't affect overall
trading," said Liberum Capital analyst Ben Bourne. He said such
cases can lead to fines and some legal costs but that Tracstar
was only a small part of the business.
Cobham has been trying to increase its exposure to
commercial markets to make up for falling spending by its
defence customers. In November it lowered its sales forecast for
2014, citing the impact of U.S. budget cuts.