M-Systems in Options Downdraft

Shares of

M-Systems

(FLSH)

plunged more than 13% after the flash-memory chipmaker joined the growing ranks of companies reviewing their past stock-option practices.

In a short filing with the

Securities and Exchange Commission

Thursday, M-Systems said it was pulling the plug on a planned public offering of 8.7 million ordinary shares due to a newly launched internal review of its past stock-option grants.

M-Systems said it had launched an internal review on its own initiative.

Several tech companies, including

Altera

(ALTR) - Get Report

,

KLA-Tencor

(KLAC) - Get Report

and

Analog Devices

(ADI) - Get Report

are the subjects of federal inquiries into a controversy involving the backdating of executive stock options.

Shares of Israel-based M-Systems were down $4.64 at $28.81 in Thursday trading.