The Securities and Exchange Commission on Thursday charged Tyler Loudon, the spouse of a bp executive, with insider trading ahead of the February 2023 announcement that London-based convenience-store and fuel company BP p.l.c agreed to acquire TravelCenters of America Inc.
Loudon allegedly made $1.76 million in illegal profits from his trading, the SEC said. The agency said Loudon misappropriated material, nonpublic information about the proposed acquisition from his wife, a bp mergers and acquisitions manager who worked on the planned deal, which closed in May.
The SEC alleged Loudon overheard several of his wife’s work-related conversations about the merger while she was working remotely, and, without his wife’s knowledge, Loudon purchased 46,450 shares of TravelCenters of America’s stock before the merger was announced on Feb. 16, 2023.
- BP America Inc./Thorntons is No. 7 and TravelCenters of America is No. 29 on CSP’s 2023 Top 202 ranking of U.S. convenience-store chains by store count.
After the announcement, TA’s stock rose nearly 71%, and Loudon immediately sold his TA shares for a profit of $1.76 million, the SEC said.
“We allege that Mr. Loudon took advantage of his remote working conditions and his wife’s trust to profit from information he knew was confidential,” said Eric Werner, regional director of the SEC’s Fort Worth Regional Office. “The SEC remains committed to prosecuting such malfeasance.”
The SEC’s complaint, filed in the U.S. District Court for the Southern District of Texas, charges Loudon with violating the antifraud provisions of the federal securities laws. Loudon consented to the entry of a partial judgement, and as part of the settlement agreed to give up his earnings and pay a fine.
The U.S. Attorney’s Office for the Southern District of Texas also announced criminal charges against Loudon.
Loudon, of Houston, faces up to five years in prison and a $250,000 fine at his scheduled May 17 sentencing before U.S. District Judge Sim Lake, Reuters reported. His wife later started divorce proceedings, the publication said, and was fired by bp despite the SEC finding no proof she knowingly leaked the takeover or knew about her husband’s trading.
The SEC’s investigation is ongoing. bp declined to comment.
After bp’s acquisition of TA, the company added 288 travel centers to its portfolio and delivered more than 60% growth in convenience gross margin year over year. But excluding TravelCenters of America, bp still had 7% growth in strategic convenience sites in the fourth quarter. bp also owns convenience-store brands ampm and Thorntons.
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