FT : Porsche and Audi raided in latest diesel probe

German prosecutors raided various Porsche and Audi sites on Wednesday for suspected “fraud and criminal advertising” related to the diesel emissions saga at parent Volkswagen Group.

Thirty public prosecutors in Stuttgart, where the sportscar maker Porsche is headquartered, searched for documents at ten properties, they said in a statement. Three people have come under suspicion, including a member of the Porsche management board, a senior Porsche manager and a former Porsche employee, the statement said.

In a statement Porsche said:

We confirm that investigators today inspected and secured documents at the offices of Porsche AG in Stuttgart and Audi AG in Ingolstadt. Audi AG and Porsche AG are co-operating fully with the investigating authorities. Please appreciate that we can’t comment on further details due to the ongoing investigation.

The raids come just days after Volkswagen initiated a massive restructuring that included replacing its chief executive officer and promoting Oliver Blume, the head of Porsche, to the VW Group’s management board.

Chairman Hans-Dieter Pötsch said on Friday that the restructuring comes a time when, “to a great extent [Volkswagen has] put the diesel crisis behind us.”

Two people at Volkswagen said the raids had nothing to do with any of the developments last week, in which Volkswagen CEO Matthias Müller — who was previously the top executive at Porsche — was abruptly replaced by VW passenger car head Herbert Diess.

Prosecutors said an investigation is ongoing and they would not provide further details. Similar raids have already been conducted at VW, Audi, Daimler and BMW.

The statement said prosecutors had received help from their counterparts in Munich, who last year arrested Wolfgang Hatz, a high-ranking executive and engineer who served across the VW, Audi and Porsche brands.

Mr Hatz, who remains in custody, was a Porsche board member overseeing research and development from 2011 until he was suspended, with little explanation, following the September 2015 revelation that VW Group had cheated on diesel emissions tests. Mr Hatz was previously head of engines and development at Audi from 2001 to 2007, and was then chief engineer for engines and transmissions at Volkswagen from 2007 to 2011.

VW shares, which rose sharply on last week’s restructuring news, were down only 0.2 per cent at publication time.

>>> US Gapping up

Gapping up
In reaction to strong earnings/guidance:

  • TXT +6.8%, MTG +5.8%, ISRG +5.5%, CSX +4.6%, UAL +3.6%, MS +2.6%, IBKR +1%

M&A news:

  • TOT +1% (enters into an agreement for the proposed acquisition of Direct Energie to accelerate its ambition in gas and electricity in France and Belgium for EUR 1.4 bln)

Other news:

  • CALA +9.4% (FDA has granted Fast Track designation to CB-839 in combination with cabozantinib for the treatment of patients with metastatic renal cell carcinoma)
  • RIGL +8.3% (confirms FDA approval of TAVALISSE for the treatment of thrombocytopenia in adult patients with chronic immune thrombocytopenia; tgt raised to $8 at BMO Capital Markets)
  • OZM +6.7% (appointed Thomas Sipp, CFA, as Chief Financial Officer)
  • TLGT +6.6% (received approval of its ANDA of Clobetasol Propionate Cream USP, 0.05%; to launch product in Q2)
  • ACRX +4.2% (publication of an analysis of the pharmacokinetic characteristics of sublingually administered tablets containing 15 or 30 mcg of sufentanil in peer-reviewed journal, Anesthesiology)
  • CNAT +4% (publication of results from both in vitro and in vivo studies of its pan-caspase inhibitor, IDN-7314)
  • RIO +3.2% (first quarter production results)
  • VMW +3.1% (Carl Icahn has taken a 'medium sized' position in VMW, according to CNBC)
  • TSLA +2.1% (after Elon Musk letter to employee circulated in late trade; internally targeting 3-4K Model 3 weekly production rate next month and 6K by the end of June), SHPG +1.6% (Swiss agency validates Shire's marketing authorization application for investigational hereditary angioedema treatment lanadelumab)
  • SIG +1.2% (CEO disclosed the purchase of 8980 shares worth ~$350K)
  • JBLU +1.2% (following UAL results)
  • AAL +1.2% (following UAL results)

Analyst comments:

  • EBAY +5.5% (upgraded to Overweight from Underweight at Morgan Stanley)
  • FSLR +3.2% (upgraded to Buy from Neutral at BofA/Merrill)
  • TEX +2.3% (upgraded to Buy from Neutral at Seaport Global Securities)
  • ZAYO +2% (upgraded to Buy from Hold at Deutsche Bank)
  • NCLH +1.3% (upgraded to Buy from Hold at Deutsche Bank)
  • DLTR +1.1% (upgraded to Buy from Hold at Loop Capital)
  • MRVL +1.1% (initiated with a Buy at Longbow)

>>> US Gapping down

Gapping down
In reaction to disappointing earnings/guidance:

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M&A news:

  • SMG -1.2% (to acquire the assets of Sunlight Supply in a transaction valued at $450 million, includes $25 million of SMG equity)

Select semiconuctor and related names showing weakness after LRCX earnings/guidance:

  • AMAT -2.6%, MU -1.1%, KLAC -0.6%, XLNX -0.5%, NVDA -0.5%

Other news:

  • AGLE -10.3% (commences underwritten public offering of 4.5 mln shares of its common stock)
  • MBII -7.1% (to offer shares of common stock in an underwritten public offering)
  • SJI -3.9% (to conduct concurrent registered public offerings of up to $325 million of shares of its common stock and 5.0 million Equity Units)

Analyst comments:

  • GRUB -1.0% (downgraded to Equal-Weight from Overweight at Morgan Stanley)
  • MO -1.1% (downgraded to Neutral from Buy at Citigroup)
  • AKS -1.7% (initiated with a Sell at UBS)
  • JNPR -2.8% (downgraded to Sell from Neutral at Goldman)
  • ZG -2.8% (downgraded to Equal-Weight from Overweight at Morgan Stanley)

>>> US Early premarket gappers

Early premarket gappers

Gapping up:

  • RIGL +14.4%, TLGT +12.6%, OZM +6.7%, CSX +4.3%, ISRG +3.3%, UAL +3.2%, MS +2.6%, TSLA +1.9%, MTG +1.8%, TXT +1.7%, IBKR +1.5%, SIG +1.2%, AAL +1.1%, JBLU +0.7%, LUV +0.6%, WSBC +0.5%

Gapping down:

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