Cobham said that the Financial Conduct Authority (FCA) had dropped an investigation started last year into the aerospace and defence firm’s handling of inside information ahead of a rights issue announcement.
“The company has fully co-operated with this investigation throughout,” Cobham said in a statement on Wednesday. “The FCA has informed the company that it has decided to discontinue the investigation.”
Known for its air-to-air refuelling technology, the engineering company has been in recovery mode since a string of profit warnings forced it into the 500 million pound ($633 million) rights issue in 2017.
The FCA investigation had related to Cobham’s compliance with listing, disclosure and transparency rules and market abuse regulations between April 2016 and February 2017.
The watchdog announced last March that it had launched an investigation into the company over its handling of inside information ahead of a trading update and rights issue announcement in April 2016, which saw the company warn over a 70% drop in profits.
Cobham said at the time that it had been informed “orally” that it was being referred to the FCA’s enforcement division for investigation in connection with its handling of inside information and that it was co-operating fully.
The rights issue, which was intended to reduce debt that built up after the company overpaid on acquisitions, was announced alongside a profit warning on 26 April 2016. However, in its preliminary results a month earlier, Cobham had posted a 9% rise in pre-tax profit and a 16% jump in trading profit and said it expected trading in its defence and security portfolio to be stable in 2016.
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