Greencore dealing tapes not complete

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The Independent Online
A FRESH storm has blown up in Dublin over the Greencore share placing debacle, after it emerged that tape recordings of dealers' telephone calls on the day of the placing at J&E Davy, the broker, are incomplete.

The general manager of the Irish Stock Exchange, which is conducting an investigation into the affair, said he was aware that there was a problem with the tapes. But it is understood that the inquiry team has not so far requested copies of them.

The gap in the recordings is understood to have been caused by a delay in starting the tapes after they were changed in the course of the day. Recording is not obligatory, but is considered best practice for large brokers such as Davy.

Investigators are attempting to piece together the sequence of events on the day of the placing by Davy of the Irish government's 30 per cent stake in Greencore, the privatised food company, at the end of last month.

It had been assumed that the investigators would use the tapes to establish what Davy salesmen were saying to institutions on the day of the placing, which unravelled when Davy disclosed that funds and companies controlled by its directors had picked up almost a third of the 25 million shares on offer.

There was speculation in Dublin yesterday that the gap in the recordings, although embarrassing to Davy, would turn out to be insignificant because the crucial conversations on the day of the placing - particularly those between Davy directors and the Irish Department of Finance - would not have been recorded. Only calls from the dealing room are monitored.

Calls made by Davy directors to SG Warburg, the London merchant bank, would similarly have gone unrecorded. The inquiry is expected to examine the role of Warburg, which ended up with 2.45 million Greencore shares, having been indemnified against losses on them by Davy.

Warburg had originally been contracted to take up to 10 million shares on an underwriting basis, but Davy cancelled this arrangement on the day of the placing.

The investigation's findings were expected to be released at the end of last week, but sources in Dublin said that the scope of the inquiry precluded early conclusions.

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