STRATEGIC PARTNERS
August 8, 2002
MEMPHIS, Tenn. -- An online report that ATM transaction processor Concord EFS (NASDAQ: CEFT) was under investigation by the Securities and Exchange Commission (SEC) sent the company's already teetering stock reeling on Aug. 8 and led company officials to publicly deny a probe was taking place.
Stock in the company, which has been steadily dropping since mid-July, finished the day down 14 percent, from $19.39 to $16.87, on unusually high volume of 45.8 million shares. The stock had dropped as low as $12.86 before rebounding.
According to published reports, Concord shares began plummeting after the online business site Briefing.com reported that the SEC was investigating the company.
The company responded with a press release announcing that on Aug. 8 it filed the sworn statements of Concord chairman and chief executive officer Dan Palmer and chief financial officer Edward Haslam with the SEC, verifying the accuracy of the company's SEC filings. The release also stated that Concord, to the best of the company's knowledge, was not under investigation.
"Although it is our policy not to comment on rumors, we believe that it is appropriate in this instance to address the rumor that Concord is under investigation by the SEC," according to the statement. "We have not been notified by the SEC that Concord is under investigation, nor have they indicated to us an interest in gathering information about Concord."
Concord stock has dropped precipitously from its year-to-date high of $35.06 on May 15. The stock was still trading as high as $28.25 on July 12, but lost 30 percent of its value in late July and early August after the company's earning per share slipped from 14 cents in the second quarter of 2001 to 12 cents during the corresponding period this year.
The loss in stock value led the company to announce a stock-repurchasing program on Aug. 5 (See story: Concord authorizes stock repurchase).
