This article is from the Australian Property Journal archive
CENTRO Properties said yesterday it will vigorously defend an investor class action to protect the interest of the group's investors.
In very short statement in response to a class action filed by lawyers Maurice Blackburn in Melbourne’s Federal Court last Friday, Centro said, “Centro will vigorously defend the proceeding in the interests of its securityholders.”
But despite Centro’s message, its share price closed 14.4% or 6.5 cents lower at 38.5 cents.
Last Friday, listed litigation funder IMF Australia gave the go ahead for Maurice Blackburn to file a $200 million plus class action against the Centro and Centro Retail Trust.
The statement of claim relates to alleged misleading and deceptive conduct and breaches by Centro and CER of their continuous disclosure obligations between August 09 2007 and February 15 2008.
IMF Australia’s executive chairman Rob Ferguson said although the maximum claim value for each action is $100 million against Centro and CER announced on April 30, the claim value has increased materially since that time.
IMF will provide an updated estimate of the claim value in its next quarterly Case Investment Report.
The legal claim against Centro could go as high as $500 million, according to legal experts.
Senior legal counsel told Australian Property Journal the $200 million estimate revealed late last week after writs were served could be in excess of $500 million.
“The $200 million is a starting point,” the leading barrister told Australian Property Journal. “It would appear more and more investors both large and small are joining the action every day.”
“If investors have been deceived and misled as has been suggested in then the claim will just snowball,”
Investment bank and analysts Merrill Lynch had earlier estimated the class action claim could be up to $250 million.
Australian Property Journal
