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Wellard settles shareholder class action

Beef Central 08/01/2024

Livestock shipping charterer and former live exporter Wellard says it has agreed to pay $23 million to settle a class action related to its ill-fated 2015 share market float.

Wellard Limited stock opened at $1.39/share upon listing in December 2015.

However, its share price plunged to 20c within 12 months, following a series of profit downgrades blamed on rising Australian cattle prices and mechanical problems with its livestock export vessels.

A class action was launched by law firm Quinn Emanuel Urquhart & Sullivan on behalf of shareholders in March 2020, and financed by litigation funder ICP Funding Pty Ltd.

ICP Funding Pty Ltd chief executive and founder John Walker told Beef Central at the time that the class action alleged that the prospectus which preceded the listing of Wellard Limited in December 2015 contained forecasts that were “misleading and deceptive”.

In an announcement to the Australian Securities Exchange Wellard Limited says the issue has now been fully and finally resolved following pre-trial mediation and the execution of a Deed of Settlement.

The announcement said the settlement “is without any admission of liability on the part of the Company and is subject to Court approval”.

The total settlement amount has been agreed at A$23 million, payment of which will be fully met from available insurance proceeds, Wellard said.

The Company said it will advise the market of the Court’s decision to approve or reject the settlement.

Wellard said the Class Action was brought on behalf of “a sub-set of the persons” who acquired an interest in Wellard’s securities at the time of the Company’s 2015 initial public offering and between the date of the IPO and 31 August 2016.

“It concerned disclosures made by Wellard in the prospectus issued in connection with the IPO, and to the ASX during the Relevant Period,” the Wellard statement said.

“Having regard to the period of time the has elapsed since the Relevant Period, any further claims sought to be brought in respect of the same circumstances would be statute barred by operation of applicable limitation legislation”.

Wellard Executive Chairman John Klepec said the company is “pleased the matter has beeen resolved, “so we can focus on the operations of the business”.

“The settlement will not impact Wellard’s cashflow.”

Wellard shares fell from 6c/share to 4c/share at the time of the announcement of the class action. In the almost four years since then, Wellard shares have traded at a high of 13c in October 2021 and January 2022, and are trading today at 4c/share.

 

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Comments

  1. Neil Searle, 05/07/2024

    Hi
    Very disappointing that I was not included in this class action! I tried to be included having bought shares during this time. I have emails confirming this and cant understand my SMSF not being told of this class action!
    I was denied the opportunity to be included!
    Neil

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