An indictment was filed in the Tel Aviv General Court against Daniel Birnbaum, former CEO of Sodastream. According to the indictment, Birnbaum – who was the company’s CEO for 12 years – provided inside information to a woman with whom he was in close contact, against whom an indictment was also filed. In addition, the two disrupted legal proceedings in relation to the version given by the employee to the banker regarding her activity in the stock.
The case was transferred to the State Attorney’s Office after an investigation by the Securities Authority, which ended in July 2020. The indictment reported that the quarterly reports published by Sodastream in February 2017 showed a significant increase in material indices, such as a 213% increase in net profit in the last quarter of 2016. Near the date of publication of the report, Birnbaum provided the employee with the inside information regarding the positive financial results.
Following the delivery of the information, a few days before the publication of the report, the employee purchased Sodastream shares for approximately NIS 150,000, and then sold the shares she purchased at a profit of approximately NIS 28,000.
After that, in 2018, Birnbaum held a meeting with the CEO and president of Pepsi, in which she suggested that Pepsi acquire the Sodastream company. And about two weeks before the announcement, Birnbaum urged the fact to invest in the Sodastream stock all of its savings immediately.
The employee understood that Birnbaum was urging her to buy shares because he had inside information that would raise the share price. The employee then purchased Sodastream shares worth about NIS 200,000. At the same time, it sought to redeem a savings bank it owns to fund further acquisitions of the company’s shares. After the savings bank’s money was transferred to her account, the employee purchased additional sodastream shares in the amount of NIS 100,000.
The day after the financial report was published, and shortly after Sodastream reported to the public on the signing of the merger agreement with Pepsi, the employee sold the remaining Sodastream shares, which she purchased and recorded a profit of NIS 156,000.
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