STOCKHOLM (Reuters) - Hexagon shares fell on Thursday after the chief executive of the Swedish measurement technology and software firm was charged with insider trading, with some calls for him to temporarily step aside.
Ola Rollen, who is one of Sweden’s most successful chief executives and turned Hexagon from a struggling conglomerate into a technology blue chip company, denies any wrongdoing.
Hexagon’s board, its main owner Melker Schorling and the AP 1 fund, the company’s sixth largest owner said on Wednesday they fully supported Rollen, who would continue as CEO.
“It is without a doubt that Ola will continue as President and CEO during this period with the Board’s full support,” said Gun Nilsson, who will take over as Hexagon chairman in May.
Norwegian prosecutors said late on Wednesday they were charging Rollen over alleged insider trading in connection with an investment in Norwegian company Next Biometrics ASA in October 2015, a transaction that did not involve Hexagon.
“We are convinced that Ola Rollen has done the things he’s now charged with, and that we can prove it in court,” Senior Public Prosecutor Marianne Bender told Reuters.
The Swedish Shareholders Association said Rollen should ponder taking a temporary leave of absence from his CEO duties.
“Ola Rollen should consider taking a time-out, because this affects confidence and it can affect the prospects to continue to develop Hexagon during the time when the legal process continues,” the Association’s CEO Joacim Olsson told Reuters.
Danske Bank said it believed the short term impact on Hexagon’s business would be minor, but added that the share price rise since November was not factoring in an indictment.
“However the duration and the share of involvement from Ola Rollen required in the process is to us still uncertain and may increase throughout the process,” Danske said.
When the company announced that Rollen had been detained on insider trading suspicion in late October, Hexagon shares fell 10 percent on the day. They have since recovered sharply, but were down 3.75 percent at 0854 GMT.
Hexagon has been become one of Sweden’s biggest companies since 2000 with Rollen at the helm and now has a market value of more than 120 billion crowns ($13.5 billion).
Rollen, who has been linked with other top jobs in the past, including taking over Ericsson, is due to address the case in a conference call at 0900 GMT.
($1 = 8.8665 Swedish crowns)
Reporting by Johannes Hellstrom; Editing by Niklas Pollard and Alexander Smith