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. Last Updated: 07/27/2016

Eurotunnel Execs to Be Investigated




PARIS -- The executive chairman of Eurotunnel, Patrick Ponsolle, three colleagues and two former company directors were being placed under formal investigation in connection with an inquiry into a 1994 capital increase that hurt small investors, a company spokeswoman said Tuesday.


Neither Ponsolle nor the three other company directors - Christian-Georges Chazot, Alain Bertrand and Graham Corbett - had received formal notification from the investigating magistrate by Tuesday night, the spokeswoman said. The two former directors, Andr? Benard and Alastair Morton, have been notified, she added.


The charges were expected to include diffusion of false information dating from the May 1994 capital increase in the company, which has the concession to run the direct rail link between Britain and mainland Europe.


The spokeswoman said the motives for investigation could vary among the six.


Ponsolle did not take over the company until July 1994 - two months after the capital increase. Eurotunnel held a 7-billion-franc ($1 billion) capital increase on the basis of three new shares for every five held in May 1994. The company said the extra cash was needed to finance cost overruns.


Soon afterward, small investors alleged that share-price manipulation had taken place in the run-up to the capital increase.


Two complaints were filed on behalf of the 700,000 small investors who saw their share prices more than cut in half in a four-month period around the time of the capital increase.


Eurotunnel is itself a civil party in one of the complaints that targets the banks, the spokeswoman said.