Tesco shareholders are considering legal action against the retailer over the missing £263m from its profits.
Tesco Shareholder Claims, a non-profit group funded by US law firm Scott + Scott, has said it will bring an action against Tesco on behalf of institutional investors.
It claims that Tesco breached the Financial Services and Markets Act when it overstated its profits. This resulted in a “permanent destruction of value to shareholders”.
After the accounting scandal emerged in September, shares in the retailer plummeted to their lowest in 14 years. They have since recovered after the appointment of a new chief executive who is tasked with reviving the troubled supermarket.
TSC says it is in “active discussion” with institutional shareholders in the US and Europe as well as the UK.
Analysts believe that the claim, if successful could be worth £5.6bn. It could also deter other investors which would go some way to undermine the ailing company’s recovery.
John Bradley, chairman of the action group, said: “Tesco is one of the widest held stocks in the UK and this loss has hit pension funds and investors across the UK and beyond. We look forward to bringing this claim to court”.
Tesco’s sales and profits have slumped leading to a major overhaul of the business which will see 43 stores closed and 10,000 jobs lost.
Comments
What about Joe Soap who bought £5000 of shares for his retirement? Sounds very unfair to me!