Recent sharp gain in Olam shares fuels concerns over possible insider trading

Temasek Holdings’ buyout offer yesterday came after Olam’s share price had accelerated dramatically in recent weeks against the backdrop of a flat market, leading some investors to cry foul and call on regulators to investigate possible insider trading in violation of securities laws.

Shareholder activist Mano Sabnani said in his Facebook posting: “What is upsetting is that there seems to have been a big leak of information on this takeover bid.

“The stock has been steadily rising on increasing trading volume in the past three to four weeks.”

Over the last four weeks, Olam shares have risen 41.1 per cent, compared with the 1.1 per cent gain in the benchmark Straits Times Index during the same period.

“In such a takeover, there will be many people involved in planning it and the chances of a leak are great. An early suspension in trading of the stock would have helped to achieve a level playing field,” said Mr Sabnani.