Centro Retail Australia has announced that it has reached an agreement to settle six proceedings, including a number of related shareholder class actions, brought against Centro Properties Group (formerly “CNP”, now “CNPR”) and Centro Retail Group (“CER”) relating to the misclassification of debt by which CNP’s current debt was understated and its non-current debt overstated.
In the largest settlement to date in any Australian class action a total settlement amount in respect of all proceedings of $200 million will be allocated between the 2 groups of claimants. The balance of the total settlement amount will be comprised of:
· $85 million from Centro Retail Australia:
· $67 million from PwC;
· $10 million from CNPR; and
· $38 million from available insurance proceeds.
The proceedings focussed on the disclosure of liabilities in the Centro Group’s audited accounts for FY07. These proceedings were commenced on behalf of shareholders who acquired securities in CNP and CER in 2007 and early 2008.
At the relevant time, PWC was the auditor for CNP and CER.
The settlement of the proceedings is subject to approval of the Federal Court on 19 June 2012.
