English 
搜索
Hebei Lansheng Biotech Co., Ltd. ShangHai Yuelian Biotech Co., Ltd.

Nufarm Is Accused of Misleading Shareholders on Profit Guidance in Lawsuitqrcode

Jan. 19, 2011

Favorites Print
Forward
Jan. 19, 2011


Nufarm Ltd., Australia’s biggest supplier of farm chemicals, provided misleading profit forecasts and debt levels last year, leading to a decline in the stock price, shareholders claimed in two lawsuits.

One group lawsuit alleged a profit forecast on March 2 of A$110 million ($109 million) to A$130 million for the 2010 fiscal year was deceptive. It was filed Jan. 14 in a federal court in Melbourne by Slater & Gordon Ltd. on behalf of Australian and international institutional and retail shareholders, Nufarm denied any wrongdoing in a statement today.

Nufarm, based in Laverton North, Victoria, cut its full- year forecast on July 14 to between A$55 million and A$65 million, saying adverse weather in Australia, Europe and North America reduced demand for crop-protection products. The shares fell 28 percent the next day, the biggest decline in 16 years.

“By failing to revise its profit guidance until 14 July 2010, it is alleged that Nufarm breached its continuous disclosure obligations,” Ben Phi, practice group leader at Slater & Gordon, the Melbourne-based class-action law firm, said in a statement today.

The Slater & Gordon claim follows a Dec. 24 lawsuit filed by Maurice Blackburn Lawyers, which Nufarm said it received today. The shareholders are seeking to recover the difference between the price at which the stock was acquired and “the true value of that interest,” according to the statement of claim filed by Maurice Blackburn in Sydney Federal Court. “Further particulars of the applicant’s loss will be provided after the filing of evidence.”

March Hearing

A hearing on the Maurice Blackburn suit is scheduled for March in Sydney, the law firm said in a statement today.

“Our clients say they have lost confidence in Nufarm’s reporting systems and its ability to estimate results,” Jason Geisker, a senior associate at Maurice Blackburn, said in the statement.

Nufarm “denies any and all allegations of wrongdoing,” the company said in two statements today. Its shares rose 0.6 percent to A$5.38 at the 4:10 p.m. close of trading on the Australian Stock Exchange.

In the July 14 statement, the company estimated its net debt at the end of the fiscal year at A$450 million, A$100 million higher than an earlier forecast, leading to a breach of loan conditions. Nufarm refinanced its debt with a A$900 million syndicated bank arrangement on Nov. 30.

Nufarm breached its continuous disclosure obligations by failing to disclose that its net debt was likely to be materially higher than A$350 million prior to July 14,” Phi said in today’s statement. “Nufarm engaged in misleading and deceptive conduct by forecasting net debt of A$450 million on 14 July 2010, when it ought to have been aware that the actual figure would be significantly higher.”

The cases are: Gaby Hadchiti v. Nufarm Ltd. VID24/2011. Federal Court of Australia (Melbourne).

Verbatt Pty Ltd. v. Nufarm Ltd. NSD1847/2010. Federal Court of Australia (Sydney).

 

Source: bloomberg

0/1200

More from AgroNewsChange

Hot Topic More

Subscribe Comment

Subscribe 

Subscribe Email: *
Name:
Mobile Number:  

Comment  

0/1200

 

NEWSLETTER

Subscribe AgroNews Daily Alert to send news related to your mailbox