Sir Ken fined for 'secret' sale of Morrison shares
Wednesday 17 August 2011
Sir Ken Morrison was fined £210,000 by the City watchdog yesterday for failing on four occasions to disclose share sales worth hundreds of millions of pounds in Wm Morrison, the supermarket chain he once ran.
Sir Ken, 79, failed to tell Morrisons when his voting rights dropped below 6 per cent, 5 per cent, 4 per cent and 3 per cent between 2009 and 2010. The sales made him about £450m.
He told the Financial Services Authority he failed to disclose his share sales because he did not know he was meant to do so.
Investors with more than 3 per cent of a public company are meant to tell the company about share sales or purchases within two days when the deals mean their holding moves through a percentage point, so the company can notify the market the next day.
Sir Ken – who built his family's grocery business into Britain's fourth-biggest supermarket group over 50 years – retired as chairman of Morrisons in March 2008 with a stake of more than 6 per cent. No further disclosures were made until March 2011, by which time Sir Ken's holding had dropped to 0.9 per cent.
The FSA said Sir Ken, who is now Morrisons' honorary president, would have been fined £300,000 but was given a 30 per cent discount for settling early.
The watchdog said he did not benefit financially from his breaches but that the market was misled and his stake was stated incorrectly in Morrisons' 2009 annual report.
Tracey McDermott, acting director of enforcement and financial crime at the FSA, said: "Investors are entitled to know when major and influential shareholders significantly reduce their interest in a listed company. Sir Ken should have been aware of his obligations and his failure to meet them has resulted in this fine."
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