Andy Bechtolsheim, co-founder of Sun Microsystems, said: Arista Networksreached a settlement with the SEC on insider trading charges, costing him nearly $1 million and barring him from serving as an officer or director of a public company for five years.
The charges against Bechtolsheim, who has an estimated net worth of more than $16 billion, Cisco’s Acquired Acacia Communications in 2019. SEC Suspect In a press release Tuesday, Bechtolsheim said he secretly learned of the “impending acquisition” on July 8, 2019, and after the trade was made public the next day, he traded options in Acacia and “combined his illicit profits.” He announced that he had received more than $415,000.
Cisco announced that it had agreed to acquire networking company Acacia for $70 per share in a $2.6 billion deal, sending Acacia’s stock price up 35%.transaction has ended closure In 2021, it will amount to $115 per share, for a total of $4.5 billion.
The complaint, filed in U.S. District Court in San Jose, Calif., alleges that Bechtolsheim, then Arista’s chairman and chief development officer, learned of the impending acquisition of Acacia from an employee of another unnamed multinational technology company. He claims to know. According to the complaint, the employee had been consulting with Bechtolsheim about its potential acquisition of Acacia.
Immediately after the discussion, Bechtolsheim traded Acacia options in the brokerage accounts of close family members and associates, according to the complaint.
“Mr. Bechtolsheim knew or was reckless in knowing that the information he learned about Acacia’s impending acquisition was material and non-public,” according to the complaint filed Tuesday. “Mr. Bechtolsheim was also reckless in knowing or failing to know that he had a duty of trust and fiduciary duty to keep such information confidential and not to trade in Acacia securities based on this information.”
The SEC said Bechtolsheim settled the charges without admitting or denying the charges against him. He agreed to pay a $923,740 fine.
Bechtolsheim, 68, stepped down as Arista’s chairman and head of development in December, but remains the company’s chief architect. He is the company’s largest shareholder with shares worth nearly $14 billion.
“While the SEC’s announcement did not include any transactions in Arista securities, Arista takes its compliance with the company’s code of conduct and insider trading policy seriously,” an Arista spokesperson told CNBC in an email. Ta. “Arista will respond appropriately depending on the situation.”
Bechtolsheim’s attorney did not respond to a request for comment.
Bechtolsheim, who lives in Incline Village, Nevada, co-founded Arista in 2004 and took the company public 10 years later. The market capitalization of this networking vendor currently stands at nearly $95 billion.
In 1982, Bechtolsheim founded Sun Microsystems with Scott McNeely, Vinod Khosla, and Bill Joy, where he served as chief hardware designer. oracle announced $7.4 billion acquisition Sun’s in 2009.
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