Oracle chief Larry Ellison cashed in shares worth £489m just weeks before the firm finally admitted that it had been hit by the slump in IT spending.

Ellison made an average profit of $30, two and a half times the firm's current share price, on each of 23 million share options exercised in the 12 months to the end of March 2001.

He sold most of his shares in January, just before Oracle's stock began a steady decline from its then price of around $35 to today's $12.

Weeks later, the firm finally reported slowing sales and weakening profit growth in March. Previously, Oracle had insisted that it had not been hit by the downturn.

The company faces several lawsuits alleging that it broke laws by making misleading statements about its prospects while Ellison and other company insiders sold their shares.

In addition to Ellison, two other top executives made large gains. Chief financial officer Jeff Henley made £59.2m ($85.6m) by exercising 2.5 million options at an average profit of $34.24 per option, while executive vice president Jay Nussbaum profited to the tune of £15.3m ($22.2m).

Ellison still owns 1.38 billion Oracle shares, currently worth £11.5bn ($16.6bn) compared with £43.3bn ($62.7bn) a year ago.