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REFILE-Italian regulator probes BlackRock over 2013 Saipem share sale
January 10, 2014 / 4:11 PM / 4 years ago

REFILE-Italian regulator probes BlackRock over 2013 Saipem share sale

(Refiles to add Reuters Instrument Code for Saipem)

By Stephen Jewkes and Chris Vellacott

LONDON/MILAN, Jan 10 (Reuters) - Italy’s market regulator is investigating whether fund manager BlackRock used inside information when it sold shares in Saipem just before the oil services firm issued a profit warning in 2013, two sources familiar with the matter said.

Consob has written to the world’s biggest money manager asking whether it had information that was not available to all market participants when it sold more than 2 percent of Saipem’s stock last January, a day before the firm cut its 2012 outlook, the sources said.

The warning sparked a slump of more than 30 percent in Saipem shares.

BlackRock said on Friday the decision to sell the shares was based on “a growing wave of negative publicly available information that was widely disseminated in the marketplace,” and that it was cooperating with Consob.

“Insider trading is abhorrent to BlackRock’s values, and we would never tolerate it,” the investment firm said in an emailed statement in response to a request for comment on the probe.

Its own investigation found no evidence of wrongdoing, BlackRock said.

Consob opened an initial probe into the profit warning and subsequent share sales last February.

Under Italian regulations, BlackRock has 540 days to reply to Consob, which sent the letter late last year.

Consob declined to comment on Friday. Saipem, which is 43 percent owned by Italian oil major Eni, also declined to comment.

Saipem, which cut its outlook for a second time in June, is embroiled in a corruption probe over allegations it paid bribes to win contracts in Algeria. Saipem has denied any wrongdoing.

News of that probe, which emerged in December 2012, led to the ousting of Saipem’s long-standing chief executive Pietro Franco Tali and his replacement by Umberto Vergine.

The corruption allegations, along with concerns that a new management team could uncover more bad news, prompted several funds to sell their shares in the oil services company at the end of 2012. (Editing by Erica Billingham)

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