SCOR’s Kessler will not be prosecuted for market abuse after Covéa allegations

SCOR’s Denis Kessler will not be prosecuted for ‘market abuse’ following an investigation by the French financial markets authority, the findings of which have been given to the French Financial prosecution office.

Kessler was accused of the office by Covéa Group, its largest shareholder, of market manipulation and the misuse of corporate assets. The catalyst for what has become a bitter feud and war of words can be traced back two and a half years and the aftermath of Covéa’s failed €8.2 billion takeover of SCOR.

Covéa’s accusations relate to actions taken between September 2018 and January 2019 including a large share buyback of roughly 4.6 million SCOR shares for €195 million. Covéa alleges this was done to artificially inflate the share price.

But yesterday (May 27) the French financial markets authority informed the French Financial prosecution office that the information it has gathered does not support the serious charges of market abuse made by Covéa against Kessler.

SCOR issued a statement that it “acknowledges and welcomes the statement by the French financial markets authority”. It also reiterated its view that the complaint of alleged market abuse was a “groundless move by the Covéa Group”.

The ruling by the French financial markets authority relates back to a complain Covéa made in March, which it actually filed on behalf of SCOR, with France’s National Financial Prosecutor’s Office, alleging market manipulation and the misuse of corporate assets.

At the time, SCOR condemned the move as “deceitful and groundless” and saying it was “astonished” Covéa had filed the complaint "on behalf of SCOR".

The announcement comes just weeks before Kessler said he would step down from his role in June for personal reasons – a year earlier than originally planned.

The announcement prompted a change in the company’s succession plans. Laurent Rousseau, deputy CEO of SCOR global property and casualty (P&C), chairman of SCOR Europe and member of the group executive committee, will assume the responsibilities of CEO following the general meeting.

Benoît Ribadeau-Dumas, who was appointed deputy CEO from January 1, 2021, was originally slated to become CEO in 2022. The board, however, decided Ribadeau-Dumas is not yet ready to take over as CEO, given his relative inexperience in the re/insurance sector.

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