Sir Ken Morrison share deals to spark FSA probe

2nd Mar 2011 13:29

The City watchdog is preparing to investigate Sir Ken Morrison, the former chairman of Wm Morrison, for apparently failing to tell anyone he'd sold almost 137m shares in the supermarket chain.Sir Ken gave up the chairman's role in March 2008, but the youngest son of the company's founder remains Life President.Between September 2009 and June the following he sold down his stake in Britain's fourth largest food retailer from 160.8m to 24m shares in deals worth more than £383m at today's price.A stock exchange notice published yesterday afternoon revealed share sales by the 79-year-old, knighted in the 2000 New Year's Honours List, took him through key thresholds on four occasions.That's attracted the attention of the Financial Services Authority which is understood to be looking into whether any disclosure rules were breached. It could issue a fine if it finds a problem.In September 2009, Bradford-born Sir Ken sold over 3.4m shares, taking his stake from 6.07% to 5.94%. Two months later that went from 5.22% to 4.96%, then from 4.18% to 3.97% in April last year and finally from 3.59% to 0.9% in June. FSA rules clearly state that major shareholders must make public any deal that takes their holding in a company above or below 3%, 4%, 5%, 6%, 7%, 8%, 9%, 10% and each 1% threshold thereafter up to 100%.They have two days to let the company know what they've done and the transaction must then be disclosed publicly the next day.In Tuesday's statement, Morrisons said it understood the changes in voting rights came about after Sir Ken retired as one of the trustees of certain family trusts and following other estate and tax planning exercises carried out following his retirement as a director. "Further, based on an analysis by the company's brokers of the company's share register, the company estimates that members of the wider Morrison family continue to own approximately 9% of the company's issued share capital," it read.Separately, analysts at Royal Bank of Scotland expect the supermarket to announce it will buy back £1bn of shares over the next two years.