Legal firm Slater and Gordon has reached a conditional agreement with the company that was Australia’s largest milk supplier, Murray Goulburn and its subsidiary, to settle a class action on behalf of over a thousand Australian and international investors.
Under the proposed agreement, the Murray Goulburn Co-operative Co Limited entities will pay a total of $42 million, inclusive of legal fees and interest, to settle the claims of class action group members. The settlement is subject to Federal Court approval.
Murray Goulburn suffered a share price collapse in 2016 after a surprise profit down-grade.
Suppliers also endured a restrospective milk price cut. The CEO resigned about the same time.
The class action was commenced in August 2018, and was pursued on behalf of more than 1300 institutional and retail investors who acquired Murray Goulburn units between 29 May 2015 and 27 April 2016.
The proposed settlement was reached ahead of a four-week trial which was scheduled to commence in February 2020.
Slater and Gordon Practice Group Leader Emma Pelka-Caven said: the conditional settlement was an outstanding outcome for group members and, if approved, will be a significant recovery of their clients’ losses.
“It was also achieved within twelve months of Slater and Gordon filing the proceeding,” Ms Pelka-Caven said.