Ericsson’s (ERICAs) stock dipped 2.5 percent on Friday as the possibility of larger penalties grew after the Securities and Exchange Commission (SEC) opened a separate inquiry into the company’s handling of wrongdoing in Iraq.
Ericsson was previously probed by US agencies, with the result that the corporation was fined $1 billion in 2019 as part of a bribery case settlement. It had to sign a diversion program agreement as well.
Ericsson’s internal inquiry in 2019 is at the center of the scandal, which began in February. Funding to the Islamic State militant group in Iraq was discovered.
Despite the fact that the misconduct did not occur under the present management, the corporation did not disclose the whole report to the Department of Justice, causing it to launch an investigation.
Angry shareholders voted against releasing board members from accountability for the year 2021. Members of the board of directors may be held personally accountable for their acts.
Since February, Ericsson’s stock has lost over a third of its worth. Although any possible fine is almost certainly priced into the stock, it does create an overhang until a deal is made.
They believe that a resolution will be improbable this year and that it could even jeopardize Ericsson’s $6.2 billion acquisition of Vonage, a cloud communications company based in the United States.
The transaction was supposed to close in the first half of the year, but it has been pushed back.
On Friday, defiant South Korean truckers began a broader and more militant strike, intending to halt deliveries of semiconductor raw materials and petrochemical commodities.
The walkout, which began on Wednesday and is now on its fourth day, has cut production at Hyundai Motor Co’s largest industrial complex and has impacted shipments for a variety of industries, including steelmaker POSCO.
The idea that major companies have sufficient inventory to ride out the strike, for the time being, has had little impact on share prices. The union claims that the strikers are far outnumbering government figures and that many non-union truckers are also unwilling to negotiate.
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