A six-year old story temporarily cuts the market value of UAL by 75%:
United stock plunges as old story resurfaces on Web
By David Greising | Tribune staff
3:08 PM CDT, September 8, 2008
United Airlines' stock fell more than 75 percent Monday morning after a nearly six-year-old Chicago Tribune news report was distributed via a market information site operated by Bloomberg L.P.
The stock, which had closed Friday at $12.30 a share, hit a low of $3 a share before the confusion was cleared up. The stock was trading recently at $10.94, down $1.36 for the day.
After being alerted to the issue Monday morning, the Chicago Tribune removed the story from its online archives which are also accessed by other Tribune Co. newspapers. The South Florida Sun-Sentinel's version of the story was the one that was cited by Bloomberg. The story did not appear on the Web site of the Chicago Tribune.
The original story, published Dec. 10, 2002, appeared the day after United Airlines filed for Chapter 11 bankruptcy, and discussed the company's strategy for emerging from bankruptcy. However, the text of the story showed up in searches of the Sun-Sentinel Web site Monday.
In a statement this morning, United said it has demanded a retraction from the Sun-Sentinel and is launching an investigation. United exited bankruptcy in February 2006.
"United continues to execute its previously announced business plan to successfully navigate through an environment marked by volatile fuel prices and continues to have strong liquidity,'' the statement added.
Joseph Schwerdt, deputy managing editor-interactive for the Sun-Sentinel, said internal tracking records show that no one at the paper had opened the original story file since 2003. The story would have been available via a search on the site, but no one outside the paper should have had access to the story file, Schwerdt said.
The Sun-Sentinel story did not have any discernible impact on United shares until after 10:53 a.m., when it was posted to the Bloomberg site. The story was posted to Bloomberg by a Miami, Fla. investment advisory firm, Income Securities Advisor.
A researcher for Income Securities, which posts stories about distressed debt securities directly to Bloomberg, became aware of the story early Monday after searching for bankruptcy situations using the Google search engine. The Sun-Sentinel story was the first story in a list of Google results, said Richard Lehmann, president of Income Securities.
chicagotribune.com |
