KLA-Tencor Comes Under Options Microscope
By Jessica Davis -- EDN, May 22, 2006
KLA-Tencor has become the most recent company feeling heat from intense scrutiny over the suspected backdating of stock options.
The company today was the focus of a new story in the Wall Street Journal that identified six additional companies that the Journal said showed suspicious timing in their granting of stock options to executives.
Also today, KLA-Tencor’s CFO Jeff Hall said that the company had been served by the U.S. Attorney’s office, one of a handful of companies in the semiconductor industry that have become part of an investigation by that office.
“We were surprised by the facts in the Wall Street Journal article this morning, especially the implication that we backdated options,” Hall said during a presentation Monday at the JPMorgan Technology Conference in San Francisco. “We take these implications very seriously. We are conducting an investigation led by an independent committee of our board of directors.”
Hall further noted that KLA-Tencor will fully cooperate with the U.S. Attorney and any other agencies conducting investigations into the backdating of options.
Several companies recently have initiated internal investigations of their options grants following an initial report by the Wall Street Journal in March that named Vitesse as one of several companies with suspicious options granting patterns. Vitesse recently fired its CEO, CFO and an executive VP following its own internal investigation. Many companies have also announced that they are under investigation by the U.S. Securities and Exchange Commission and the office of the U.S. Attorney.
