Politicians have questioned the timing of a probe into Deutsche Börse AG CEO Carsten Kengeter's purchase of shares in the exchange ahead of merger talks with London Stock Exchange Group Plc, The Telegraph reported Feb. 2.
Meanwhile, the Frankfurt public prosecutor has expanded the ongoing investigation against Kengeter to the whole group and will probe whether Deutsche Börse informed shareholders about the planned merger with LSE early enough, Handelsblatt reported Feb. 6.
Prosecutors in the German state of Hesse raided Kengeter's office and apartment in the week of Jan. 30, seeking information about the purchase of some €4.5 million of shares that Kengeter acquired in the exchange in December 2015, the Telegraph noted. However, the purchase was disclosed at the time it was made, and is understood to have been required as part of Kengeter's employment obligations, the publication wrote, adding that Deutsche Börse and LSE also argue that they began merger talks in January 2016.
Chris Philp, a member of the influential House of Commons treasury select committee, questioned why the probe was launched so long after the purchase.
"On the face of it this share purchase seems to be completely above board," he reportedly said. "It was publicly disclosed at the time and was possibly a requirement of his employment."
Meanwhile, a spokeswoman for the prosecutor's office told Handelsblatt that the authority wants to make sure Deutsche Börse sent a required ad-hoc release in a timely manner to indicate that it and LSE were in talks. The release was sent Feb. 23, 2016, and the companies agreed to merge just under a month later.
Deutsche Börse has declined to comment because the investigation is ongoing.