Transpacific Industries to pay $A35m shareholder settlement
BUSINESSDESK: Trans-Tasman waste management company Transpacific Industries has reached a $A35 million settlement with shareholders threatening a class action alleging breaches of disclosure rules.
The Brisbane-based company will pay $A25m in June and as much as a further $A10m by June 30, 2014, it said.
As part of the deal, Transpacific Industries admits no liability. It will include the final settlement as a significant item in its 2012 annual result.
“We took the decision to participate in a structured mediation process having regard to the likely costs involved, and the uncertainties and risks that are inevitably associated with claims of this nature,” chairman Gene Tilbrook said.
“The negotiated settlement with members of the proposed securities class action will resolve this action which grew out of events that occurred several years ago under a previous management regime.”
In 2010 Australian litigation funder IMF took the class action on behalf of shareholders, alleging misleading or deceptive conduct and alleged breaches by Transpacific Industries of continuous obligations between August 29, 2007, and February 16, 2009.
The deal was reached in pre-proceeding discussions, and IMF expects to recognise revenue of $A13.1m if it becomes unconditional, it said in a statement to the ASX.
Transpacific Industries shares rose 1.3% to 77.5 Australian cents on the ASX on Thursday.
They are listed on the NZX but rarely trade.