Pet Food Executive Sold Shares Before Recall
This is a partial transcript of "The Big Story With John Gibson," April 11, 2007, that has been edited for clarity.
JOHN GIBSON, HOST: The "Big Issue" today is a very suspicious financial transaction made by a top executive at the company at the center of the pet food scare. It was a personal transaction made by a Menu Foods bigwig and when he made it is raising a lot of questions about who knew what and when, and how many animals' lives could have been spared. BIG STORY correspondent Douglas Kennedy has all the details — Douglas.
DOUGLAS KENNEDY, FOX NEWS CORRESPONDENT: Yeah John, this financial transaction was a stock sale and it just happened to be made that the day the company learned of the problems with their pet food. Financial experts want an investigation.
(VOICE-OVER): His company has a damaged reputation and has lost much of its value, but a top executive at Menu Foods will not suffer financially.
MARC TACCHI, FORBES MAGAZINE: It's just bad. It looks terrible on the face of what has already happened with this company.
KENNEDY: Menu Foods is the Canadian company at the center of a massive pet food contamination. The company's chief financial officer is named Mike Wiens. Canadian insider trading records just released show Wiens sold almost half his stock in the company just weeks before Menu Foods announced a recall. Marc Tacchi is covering the potential scandal for Forbes magazine.
TACCHI: I think it's highly suspicious, it's something that deserves a lot more examination.
KENNEDY: In an interview with the Toronto based newspaper, The Daily Globe and Mail, Wiens calls the sale a "horrible coincidence." Still, given the timing of the recall, the financial trail is troubling. In the past, Menu Foods has admitted receiving calls about sick cats on February 26. The exact day, records show, Wiens began to dump 14,000 shares worth 100,000 of his stock. A company spokesperson told the Associated Press Wiens he had no idea at that time about the potential fallout. "He is a highly principled guy and for the amount of money that we are talking about, for him to imperil his career, it just doesn't make any sense." Since the recall began, Menu Foods has lost 40 percent of its value. And financial analysts predict that the company may not survive.
TACCHI: This is cataclysmic for this company. We haven't really reached the bottom of what is the substance of what's happened here.
KENNEDY: And what continues to happen. Just today, a major animal hospital chain says it has seen a 30 percent increase in kidney failure among cats since the beginning of the contamination. So, this saga, John, is definitely far-reaching and ongoing.
GIBSON: What we're supposed to believe here — I realize it's a small amount of money, it was 90,000, but we're suppose to believe that the company's receiving calls: hey cats are dying, but the CFO doesn't hear about it for a week?
KENNEDY: That's what he says. He says, you know: we started receiving these calls, but it's a big company and didn't work its way through to the top executives until a week later.
GIBSON: The guy in charge of, let's say, we had to make a big payout, in case people sued?
KENNEDY: Yeah, this is the chief financial offer.
GIBSON: Douglas Kennedy. Douglas, thank you very much.
Content and Programming Copyright 2007 FOX News Network, LLC. ALL RIGHTS RESERVED. Transcription Copyright 2007 Voxant, Inc. (www.voxant.com), which takes sole responsibility for the accuracy of the transcription. ALL RIGHTS RESERVED. No license is granted to the user of this material except for the user's personal or internal use and, in such case, only one copy may be printed, nor shall user use any material for commercial purposes or in any fashion that may infringe upon FOX News Network, LLC'S and Voxant, Inc.'s copyrights or other proprietary rights or interests in the material. This is not a legal transcript for purposes of litigation.