TWE’s announcement that its first half FY14 earnings will be substantially less than the previous year and that its full year earnings range will be 15 per cent less than previously expected has provoked a furious reaction from investors, with the company’s share price diving 20 per cent by 2pm today.
Ben Slade, Managing Principal at Maurice Blackburn Lawyers (NSW), who will lead a shareholder class action against TWE funded by Bentham IMF Limited said that today's announcement raises questions of transparency about the company's operations.
"TWE's announcement this morning suggests that continuous disclosure requirements may not have been complied with. We are confident that the company's shock $190 million downgrade announcement in July last year was indicative of such a breach. It may have happened again," Mr Slade said.
"If our investigations reveal that TWE has been less than frank with the market, our class action will be expanded to claim for the losses suffered today."
Mr Slade said investors and shareholders had a right to be fully apprised of the true state of a company's finances at the earliest opportunity.
"The class actions mechanism enables shareholders to hold recalcitrant companies to account when they fail to meet their continuous disclosure obligations - without class actions thousands of retail and institutional investors would be unable to enforce their rights.
"Acceptance of the class action regime is evident in the increasing participation of investors in shareholder class actions. The ACCC and ASIC accept class actions as a welcome complement to their regulatory roles."
About Maurice Blackburn
Maurice Blackburn's class action practice is the largest in Australia and has secured more than $1 billion in settlements for shareholders, businesses and consumers over the past 15 years.
Maurice Blackburn is the only class action law firm to have achieved settlements over $100m including those against Centro ($150m) Aristocrat ($144.5m), NAB ($115m), GIO ($112m) & Multiplex ($110m). Over the past decade Maurice Blackburn has settled several shareholder and cartel actions against big companies such as AWB, Nufarm, Oz Minerals & a price fixing cartel action against various multinational vitamins companies. In 2011 a massive cartel claim against Amcor and Visy was settled for $120m - the largest cartel settlement in Australian corporate history.
The firm is currently acting in a series of other class actions for shareholders, victims of bushfires, floods, faulty products and a price fixing cartel. It is also conducting a series of class actions against banks over bank exception fees in conjunction with Bentham IMF and two class actions against Cash Converters over exorbitant interest charges on pay day loans.
About Bentham IMF Limited
Bentham IMF Limited (IMF) is Australia's largest litigation funding company. IMF's principal activities are the investigation, management and funding of claims in Australia and other jurisdictions.
IMF has successfully funded numerous shareholder class actions and since 2001. IMF has recovered in excess of $1.2 billion dollars for its clients across a range of commercial, insolvency and multi-party cases.
To find out more about the TWE class action visit www.benthamimflimited.com.au or call 1800 016 464.