I tried to post this the other day, but somehow it didn't make it. So I'm trying again. This is not good news for stock price.
Dow Jones Newswires -- July 12, 1998
Microsoft May Take Legal Action Vs
Chiroscience - Report
Dow Jones Newswires
LONDON -- A group of U.S. investors including Bill Gates, Chief Executive Officer of Microsoft Corp. (MSFT), is considering legal action against U.K. biotechnology company Chiroscience Group PLC (U.CCC), according to a report in the Sunday Times.
The investors, who took Chiroscience shares in part payment when they sold U.S. biotech company Darwin Molecular, want to know why they weren't fully informed about the U.K. company's legal liabilities.
Last week, Chiroscience paid GBP3.25 million to Nowell Stebbing, its former deputy chairman, in an out-of-court settlement. The sum will be funded partly through a placing with institutional investors of 800,000 existing shares held in Chiroscience's employee share ownership plan. The company also made a provision in its accounts for the year ended February 1998 to cover part of the payment.
The dispute centers on Stebbing's compensation package when his status changed from an executive to a non-executive director.
According to the report, the London Stock Exchange is also considering an inquiry because the legal action wasn't disclosed in 1996 when Chiroscience raised GBP41 million through a share issue priced at 410 pence a share to fund the acquisition of Darwin.
(A story that ran at 1330 GMT incorrectly identified Microsoft Corp. as a Chiroscience investor.)
-By Allison Bisbey, 44-171-832-9112; ABisbey@ap.org
Copyright c 1998 Dow Jones & Company, Inc. All Rights Reserved.
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