The Uniti Group Ltd (ASX: UWL) share price had a volatile end to the trading session on Tuesday.
The telecommunications services provider’s shares crashed as much as 17% in late trade to $3.42.
However, the Uniti share price soon rebounded to be down 5% to $3.90 before being placed into a trading halt.
Why is the Uniti share price sinking?
Investors were selling down the Uniti share price this afternoon after it emerged that its Executive Director, Vaughan Bowen, has appeared in court accused of insider selling. This was prior to his time with Uniti.
As we covered here, Mr Bowen allegedly sold $25.7 million worth of Vocus shares in 2019 while possessing inside information.
The Australian Securities and Investments Commission (ASIC) alleges that Uniti’s Executive Director, who was the Vocus Chair at the time, sold 5,617,554 Vocus shares on 4 June 2019.
After a relatively flat day on 4 June, the telco’s shares crashed lower a day later after EQT Infrastructure IV Fund withdrew from takeover talks. ASIC alleges that Bowen knew that the takeover discussions were over when he sold his shares, saving him ~$4.5 million.
Why did Uniti request a trading halt?
Management requested that the Uniti share price be put in a halt this afternoon so that it could respond to the news.
Its trading halt request was: “To enable an orderly release of information regarding an announcement regarding a member of the executive team in response to media activity.”
The company confirmed that it expects the announcement to be made “no later than commencement of trading on Wednesday 15 September 2021.”
All eyes will be on the Uniti share price when that announcement is made. Year to date, the company’s shares are up an impressive 123%.
The post Why the Uniti (ASX:UWL) share price crashed 17% on Tuesday appeared first on The Motley Fool Australia.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Uniti Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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