Indian-origin entrepreneurs hit by insider-trading charges in US
Two Indian-origin entrepreneurs have been charged with insider trading in the US in connection with the 2013 proposed acquisition of American company Cooper Tire and Rubber by Apollo Tyres.business Updated: Apr 03, 2015 23:02 IST
Two Indian-origin entrepreneurs have been charged with insider trading in the US in connection with the 2013 proposed acquisition of American company Cooper Tire and Rubber by Apollo Tyres.
Amit Kanodia of Massach-usetts, a 47-year-old private equity investor, and Iftikar Ahmed, of Connecticut, a general partner at a venture capital firm have been charged with fraud by the Securities and Exchange Commission (SEC) in a complaint filed in US district court in Connecticut.
The SEC has alleged that Kanodia tipped Ahmed and another friend after learning of the deal from his wife, who was Apollo’s general counsel at the time, more than two months before the merger was announced. Ahmed then bought significant amounts of Cooper Tire stock and options. Once news of the deal was public, Ahmed liquidated his Cooper Tire holdings, reaping $1.1 million of ill-gotten profits. Ahmed later paid Kanodia a kickback by transferring $220,000 to Lincoln Charitable Foundation, a supposed charity that Kanodia controlled.
Apollo had agreed to buy Cooper Tire and Rubber for $2.5 billion in 2013. The merger was abandoned in December that year.