Paris - Former co-CEO of European aerospace group EADS Noel Forgeard has been placed under investigation on suspicion of insider trading, French media reported Friday.

After being held in Paris for questioning by investigators for 35 hours, the 61-year-old Forgeard appeared overnight before two magistrates, who formally initiated judicial proceedings against him and then released him on bail.

Under French law, being placed under investigation is a stage preliminary to formal charges being brought. If he is charged and convicted, Forgeard could face a maximum sentence of two years in prison and a massive fine.

Forgeard is suspected of being aware of problems with the production of the A 380 superjumbo built by EADS subsidiary Airbus when he sold a large block of shares in March 2006, three months before EADS formally announced that delivery of the plane to its customers would be delayed.

The announcement caused EADS shares to lose more than 30 per cent of their value. Forgeard made a profit of about 2.5 million euros (3.9 million dollars) on those stock sales, and earned another 1.8 million euros from the sale of other EADS shares in November 2005.

In November 2006, the French securities watchdog AMF opened an investigation into the sales of EADS shares by Forgeard and 16 other EADS and Airbus executives.

In the seven months before the A 380 announcement, the 17 executives exercised stock options on some 1.7 million EADS shares, for a gross profit of about 20 million euros.

Forgeard was head of Airbus from April 1998 until June 2005, and EADS co-chief from June 2005 until July 2006. He was forced to step down in the company shake-up provoked by the A 380 problems. (dpa)