Did Warner Chilcott Insider Sell Stock Before Releasing Information?
Warner Chilcott Plc. (NASDAQ:WCRX), which makes drugs specially designed for women's health and dermatology, announced on Wednesday, August 8, that it had ended its efforts to sell the company, which caused its shares to fall nearly 7 percent.
According to Bloomberg, the drugmaker plans to revamp a $250 million share buyback program, and will pay a cash dividend of $4.
"It seemed clear that the attempts to be bought by someone had stalled," said James Molloy, an analyst with San Francisco- based ThinkEquity LLC. "It’s certainly a play they’ve used before,"
The company said it plans to fund the dividend with existing cash and another $600 million in new debt. In April, the drugmaker first said it was potentially looking to sell itself, and it reportedly had a number of strategic and private equity buyers lined up. This however, did not pan out, much to the disliking of investors.
It appears company officials may have been privy to the situation before announcing the end of the sales effort, as $6,380 in shares were sold through insider trades in the last three months.
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