Maurice Blackburn is coming at Lendlease with potential class action
Written on the 4 April 2019 by Business News Australia
Australian class action law firm Maurice Blackburn is investigating a potential shareholder class action against Lendlease Group (ASX: LLC) after the construction group allegedly misled the market.
The investigation arises from alleged misleading behaviour from Lendlease who Maurice Blackburn say failed to adequately disclose the long-running problems affecting its engineering and services business.
Maurice Blackburn alleges that Lendlease's failures led to a single-day share price drop of 18 per cent in November 2018.
Shareholders affected by the drop can register to participate in Maurice Blackburn's proposed class action until 17 May 2019.
CLASS ACTION BACKGROUND
On 9 November 2018, Lendlease announced to the market that it had identified 'further underperformance' in its engineering and services business.
This announcement saw shares in the company dive more than 18 per cent in a single day.
The company reported a disappointing first half of the financial year in February 2019, with profit diving to $15.7 million from $425.6 million in the previous year.
This 96 per cent plummet led management to announce a reconsideration of the value Lendlease's underperforming engineering and services business.
The company determined the segment was "non-core" and no longer a required part of the group's strategy.
The total cost of the restructure of Lendlease will come between $450 million and $550 million before tax as a preliminary estimate.
Maurice Blackburn's proposed action will allege that Lendlease failed to comply with its continuous disclosure obligations under the Corporations Act 2001 (Cth) and the ASX Listing Rules and engaged in misleading and deceptive conduct in respect of the performance of its engineering and services business.
Since the first half results announcement the company has been awarded a lucrative Gold Coast Airport expansion project worth $370 million.
Lendlease will construct the hub's southern terminal expansion.
Shares in Lendlease are down 0.44 per cent to $12.32 per share at 10.58am AEDT.
Business News Australia
Author: Business News Australia