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Investors and Wall Street supporters of Steve Jobs rallied to defend the visionary founder of Apple Computer as a growing storm over manipulated share options and forged documents threatened to engulf him.
The company's shares took another early morning dive yesterday amid reports that federal authorities are investigating
a massive grant of share options to Jobs and that documents were forged to give the misleading impression that Apple's board had approved the grant.
Apple insisted that it stood by its October statement that no current board members were guilty of misconduct, but it has promised to provide an update on the scandal before the end of today.
Analysts tried to calm fears that new revelations might force the resignation of Jobs as chief executive, robbing the company of the technological vision and marketing genius that has made the iPod one of the most successful gadgets of all time.
Gene Munster, technology sector analyst at Piper Jaffray, said he could not believe that Jobs was personally involved in manipulating stock options grants to bolster executive pay.
"People want Steve Jobs to be Apple chief executive and he probably didn't have anything to do with this," he said. "He is above a lot of this noise, typically much more focused on the business. He is not on the compensation committee. I think he will be found clear of everything."
A newspaper report claimed that Jobs received a grant of 7.5 million share options in 2001 without the required approval from the full Apple board. Documents drawn up later were forged to give the impression that the board had in fact met and approved the grant, as Apple's remuneration procedures insist.
Apple has already said that an internal investigation raised "serious concerns regarding the actions of two former officers in connection with the accounting, recording and reporting of stock option grants".
The new report puts pressure on Jobs and other continuing board members to say if they knew that remuneration procedures were not being properly followed.
Jonathan Hoopes, analyst at ThinkEquity Partners, said the share price fall was not justified because Jobs' position was not in danger.
"If in fact a current manager did misconduct him or herself and Apple knows about it, it would be required to put out a press release. Since we haven't seen anything like that, we are right back where we were in October and the recent flurry of activity is much ado about nothing.
"My position before was that Steve Jobs is unlikely to lose his job, and that is still my position today."
- INDEPENDENT