Nippon’s DiData buy in insider trading probe

Dimension Data's £2.1 billion takeover was today at the centre of an insider trading probe into "suspicious" trading activity prior to the deal's announcement.

Nippon Telegraph and Telephone agreed a takeover deal of the IT group last month but shares rose in unusually busy trading two days beforehand.

The shares, traded both in London and South Africa, rose 4.9%. Trading data shows that nearly eight million shares changed hands compared with an average 2.6 million.

Alex Pascoe, deputy director of the Pretoria-based Financial Services Board's directorate of market abuse, which investigates insider trading, told Bloomberg: "The stock exchange picked up certain trading activities just prior to the deal. We've logged the case as an insider trading case. We'll proceed with an investigation."

It is not clear whether the Financial Services Authority is working with its South African counterpart on the probe but observers said it would inevitably be involved because of the dual-listing of the company here in London. After the deal was announced shares leaped 20%.

NTT said it wanted to buy the company to boost its operations in emerging markets, especially Africa, South America and the Middle East.