Odyssey Investment Partners’ 2005 acquisition of Neff, valued at $510 million, is the subject of insider trading charges unveiled this week by the US Securities and Exchange Commission.
The SEC has accused six individuals of illegally trading Neff securities based on advanced knowledge of the company’s acquisition. No Odyssey employees have been accused of any wrongdoing.
The accused include professionals who worked on due diligence during the acquisition process; a friend and the father-in-law of Juan Carlos Mas, Neff’s chief executive officer, and a friend of Jorge Mas, a Neff director.
According to the SEC, the accused parties gained inside information of the impending acquisition and purchased securities of the Miami-based equipment-rental company.
Attorney Kevan Acord and accountant Philip Growney, who worked on due diligence leading up to the Neff acquisition, are accused of buying Neff securities that were exchanged for a total combined profit of about $167,200, the SEC said.
Sebastian De La Maza, the father-in-law of Neff’s CEO, Juan Carlos Mas, has been accused of buying $111,000 of Neff securities, netting $84,000, after learning of the Odyssey deal from his daughter, the SEC said.
A close friend of the CEO, Alberto Perez, is accused of buying 83,000 shares of Neff stock and earning $399,000 from their sale after learning of the deal while working in an office near the company’s due diligence teams, the SEC said.
Another of the accused, Thomas Borell, a Miami lawyer, purchased $1.3 million of Neff stock while on a family vacation with Neff company director, Jorge Mas, according to the SEC complaint.
Jorge Mas, Juan Carlson Mas and his wife have not been accused of any wrongdoing, a spokesperson for Miami’s regional SEC office confirmed.
Odyssey first contacted Neff about a deal in late 2004. On 6 April, 2005, Neff’s board of directors approved the acquisition and a public announcement was made the following day.
Odyssey exited Neff in 2007 to Lightyear Capital in a deal worth about $900 million.