Martha, "Oh surrrrrrre, that's right. If only I had testicles and grew a beard I wouldn't be in prison either.
Posted on 09/19/2004 9:59:45 AM PDT by Steven W.
At the height of Rathergate, it appears Sumner Redstone, Chairman and CEO of Viacom Corporation, has issued his first verdict on the collapse of credibility for its CBS News operation and 60 Minutes programming. In disclosure mandated by the SEC, "STATEMENT OF CHANGES OF BENEFICIAL OWNERSHIP OF SECURITIES", Redstone reveals his transaction promptly followed the disasterous & defiant appearance by Dan Rather on last Monday evening's edition of the CBS Evening News. In official filing, and with Viacom currently selling near 5 year lows, records reveal Redstone sold 341,500 shares of Viacom stock options for an otherwise undisclosed 401K account on Tuesday of last week, September 14, 2004. Overall, with shares still selling for $11,952,500 at only $35 a share, his gross profit from the transaction appears to have yielded around $6,744,625 in cash.
Agreed.
Besides Sumner and daughter and I suppose Moonves all support Rather's ideology same as he does.
What's the connection. if any, to Midway Games Inc?
http://www.sec.gov/Archives/edgar/data/1204726/000122520804001586/xslF345X02/doc4.xml
On 9/16/04, SR had some activity in this equity.
But the CEO has the power to stop the bleeding. He could fire Dan Rather and the entire CBS 60 minutes crew and show that he is serious about cleaning up the situation. Instead of doing that he is dumping his stock. He knows that its not going to get better. He knows that stopping the bleeding is not going to cure the patient. He knows something we don't know. And he is reacting to that knowledge. That's insider trading.
In this type of situation a CEO cannot buy or sell his own company stock. It is presumed to be insider trading if he does.
Great!
The option price was reported to be $15.25 - he both exercised and sold the bulk shares for that option on one day in one transaction.
What was Viacom trading at at the time? Do you know?
Martha, "Oh surrrrrrre, that's right. If only I had testicles and grew a beard I wouldn't be in prison either.
>>Saj, is Sumner just writing covered calls in this article when they say that he is "selling stock options" or is it that he dumped options that he'd purchased earlier?
I expect neither. These would be stock options granted to corporate execs as part of a compensation package. Typically what happens, is that someone is granted, say, options on 10,000 shares, at the current price, as an incentive to work to raise the stock price. If the stock price rises, the grantee can exercise the option, sell the stock, and make a profit on the difference.
This is totally different from "call" and "put" options trading on future value of stocks.
Anyone who owns mutual funds which own large amounts of Viacom, should let the fund managers know that they will be held responsible for investing and staying a loser stock, if Viacom stock tanks.
The link below will take Freepers to the ownership of Viacom by institutions and investment firms:
http://moneycentral.msn.com/investor/invsub/ownership/ownership.asp?Symbol=via
Gabelli Funds Llc 4,682,247 10,000 0.0 -14,540,968 0.0 1.8 06-30-04
Gabelli Asset Management Co (gamco) 4,130,292 64,610 2.0 -10,620,952 0.0 1.1 06-30-04
Axa Rosenberg Investment Management 1,747,535 93,200 6.0 -1,889,509 0.0 0.3 06-30-04
New Jersey State Division Of Investments 1,675,000 0 0.0 12,060,000 0.0 0.2 06-30-03
Sac Capital Mgmt 1,055,500 1,055,500 100.0 38,367,424 0.0 0.6 06-30-04
Tcw Group 890,525 79,110 10.0 287,235 0.0 0.1 06-30-04
Tiaa Cref Investment Management Inc 878,508 -7,400 -1.0 -3,095,037 0.0 0.0 06-30-04
Capital Research & Management Co 850,000 0 0.0 -2,711,500 0.0 0.0 06-30-04
Lord Abbett & Co 667,854 22,125 3.0 -1,255,632 0.0 0.0 06-30-04
Vanguard Group 460,570 24,412 6.0 -503,968 0.0 0.0 06-30-04
Columbia Management Advisors (boston)/fleetboston 444,471 -79,237 -15.0 -4,550,893 0.0 0.0 06-30-04
Kicap Management Lp 418,909 408,855 4,067.0 14,829,807 0.0 6.2 06-30-04
Jl Advisors Llc 400,000 400,000 100.0 14,540,000 0.0 1.8 06-30-04
Carlson Capital Llc 399,200 2,000 1.0 -1,194,368 0.0 0.4 06-30-04
Credit Suisse First Boston Inc 385,845 73,500 24.0 1,675,345 0.0 0.0 06-30-04
*Category Headings:
Shs Held - shares held at report date
Shs Chg - position change within reporting period
%Chg - % change
$Chg - market value of the position change
%Out - % of shares outstanding
%Port - % Portfolio
Rpt Date - report date
Redstone has been buying shares in Midway Games like mad for months. Now discussion that Viacom may want to buy it out. This is an unbelievable conflict that has not really been commented on in the press. He has made millions on Midway and now wants Viacom to buy it. Viacom should have been the one buying it all along and they would have reaped the profits to date, not himself personally.
In terms of his Viacom sale, this is not insider trading.
Most options have an expiry date, and they expire soon for all we know.
The one line in this article that may raise a red flag is "an otherwise undisclosed 401k holding"...meaning what? He hasn't filed before these holdings? That would be a bit of a problem for him.
He can do it and be legal as long as he was acting on publically-available information. Only if he was acting on information known to company insiders but not to the public has he done any wrong.
LOL
Follow the money...
But the CEO has the power to stop the bleeding. He could fire Dan Rather and the entire CBS 60 minutes crew and show that he is serious about cleaning up the situation. Instead of doing that he is dumping his stock. He knows that its not going to get better. He knows that stopping the bleeding is not going to cure the patient. He knows something we don't know. And he is reacting to that knowledge. That's insider trading.
In this type of situation a CEO cannot buy or sell his own company stock. It is presumed to be insider trading if he does.
bttt
Steven,
If you do not have a history of the selling of shares by corporate insiders, then it is impossible to take one instance out of context, regardless of the timing the sale as it relates to RAThergate.
Rule 144 of the SEC states that you must have owned the shares more than one year, and once you file a notice on Form 144, you have 90 days to make the sale.
Insiders typically get stock opptions granted to them so they are continual sellers of stock. The sale of stock of insiders dwarfs the purchase of stock by insiders for this reason.
Also, many insiders have a regular pattern of selling stock and the timing in this case could be a coincidence.
There is a also a "1 percent" rule regarding maximum sales of Rule 144 stock that prevents any meaningful amount being sold at any one time during any three month period.
I have been Series 7 licensed since 1987.
Before you get to excited, read my post #76.
Even if you wanted to tie this into the SEE BS scam, the important thing was when was the From 144 filed, not when was the stock sold.
When the form was filed is easily accessible over the Internet.
MONEY TALKS...BULL SH*T WALKS....
Their problem is lack of growth and profits, not Rather and his Democratic Spin Binges. If they get rid of Rather and the left leaning staff or just bring in some even handed journalists they might climb back out of the hole. MSNBC has figured it out. ABC even realizes you can't pass off half your market as not worthy of attention.
From what I've seen via yahoo, his sale was not in the "planned sale" category as other recent insider trades. Also, it's unclear whether these transactions were even 144 sales. I was series 7 myself for seven years.
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