Reuters: Bankruptcy News: UPDATE 1-Pescanova chairman sold shares before crisis struck

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UPDATE 1-Pescanova chairman sold shares before crisis struck Apr 15th 2013, 16:44 Mon Apr 15, 2013 12:44pm EDT (Recasts with sale of chairman shares, new auditor, detail) MADRID, April 15 (Reuters) - Pescanova's chairman sold half of his stake in the Spanish fishing company before deep debt problems became public in March and trading in its shares was suspended, the company said on Monday. Pescanova initiated bankruptcy proceedings in early March after a deep and long recession in Spain left it unable to pay debts of at least 1.5 billion euros ($1.96 billion) racked up during an ambitious expansion. But bickering between board members, questions over its accounts and a row with its auditors have slowed efforts to hammer out a survival plan. The company said it hired new auditors on Monday to probe the accounts as it filed formally for insolvency after failing to negotiate a rescue with its creditors. The jobs of 10,000 workers who catch, process and package fish on its factory ships around the world are under threat. In a filing to the stock market regulator, the company said it was still trying for a deal with the creditors so it could stay afloat and maintain jobs. But a separate statement on Monday only added to the sense of crisis surrounding the company. Pescanova said its chairman, Manuel Fernandez de Sousa, had sold about half of his 14.4 percent stake between December and February and later lent money back to the company in what it said was an attempt to alleviate its cash shortage. The move was not made public and could be deemed illegal under Spanish securities rules, which state that a company's board members must report changes in their holdings. The company suspended its auditors BDO earlier this month. It said on Monday that KPMG would now carry out a forensic analysis of its accounts. Pescanova reported discrepancies in the books on March 12, a day after the market regulator said it would investigate the firm over possible market abuse. BDO, in a letter to the chairman that was made public by the stock market regulator, said: "BDO wants to firmly insist on the fact that its suspension is groundless because it has met all the obligations inherent to its activity." Pescanova had hoped to extricate itself from crisis by selling its salmon farming business, but the plan failed. ($1 = 0.7643 euros) (Reporting by Julien Toyer; Editing by Tom Pfeiffer) Link this Share this Digg this Email Reprints

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