STEC Hires E&Y as Independent AuditorWednesday, September 26, 2012
Santa Ana-based disk drive maker STEC Inc. has hired Ernst & Young LLP as its new independent auditor.
The move came two weeks after PricewaterhouseCoopers LLP resigned as the company’s auditor.
STEC makes flash memory drives for corporate data networks. The products are known as solid state drives and use chips to store data. The company had annual revenue of $308.1 million last year, with more than 900 employees overall, including about 200 in Orange County.
STEC’s shares were about even in early trading today, with a market value of about $331 million.
A regulatory filing on PwC’s departure as STEC’s auditor indicated there had been no disagreements between the two companies that led to move.
“The selection of Ernst & Young concludes a thorough evaluation process conducted by the Company for an independent audit firm to succeed PricewaterhouseCoopers,” said Rajat Bahri, chairman of the audit committee of STEC’s board. “We believe that Ernst & Young has the expertise and global reach to provide for a seamless transition and we are looking forward to working with them.”
The switch in auditors comes at a significant juncture for STEC, in any case. Its former chairman and chief executive, Manouchehr Moshayedi, is fighting insider trading charges levied by the Securities and Exchange Commission.
Moshayedi recently resigned his executive positions at STEC, and has denied those charges in a recent filing in U.S. District Court for the Central District of California.
Moshayedi contends he was “unaware of any material information that had not been publicly disclosed at the time of the public offering,” according to the filing.
The SEC has charged Moshayedi with violating anti-fraud provisions of U.S. securities laws, and seeks a final judgment ordering him to relinquish any trading profits, pay prejudgment interest and financial penalties, and be permanently barred from serving as an officer and director of any registered public company.