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gio holders win!

  1. 6,931 Posts.
    Having been part of a number of takeovers I followed the advice of the GIO Directors with disastrous results. Now I will get something back.



    GIO investors win $112m
    By Alex Tilbury
    August 8, 2003

    AFTER four years of legal wrangling, GIO Insurance investors today won a $112 million settlement over AMP Ltd's acrimonious $3.3 billion takeover of the group in 1999.

    The shareholders' lobby group today cheered the news as a significant win for GIO shareholders.

    GIO shareholders claimed they were misled by GIO and its former directors and advisers who told them to reject AMP's first takeover offer as inadequate.

    Nine former GIO directors were sued under a class action brought on behalf of about 68,000 shareholders who accepted advice to keep their shares, rather than sell to AMP Ltd during the hostile takeover battle.

    The shareholders later received less for their shares.

    AMP said it would pay $56.8 million as its part of the $112 million settlement but that the payout would not affect its profits.

    The remaining money would be paid by other parties, including the nine directors and GIO's independent advisers.

    AMP said its $56.8 million was covered by reserves and would not impact profit and loss.

    Australian Shareholders Association deputy chairman Stephen Matthews cheered the news as "a first for shareholders and it puts all company directors on notice".

    "The whole action illustrates that hostile takeovers, without due diligence, have an ongoing cost and this is part of that," Mr Matthews said.

    "AMP have not provided for it in their accounts, so it will have to come out of reserves which is a fine technical point ... they will transfer some reserves to the profit and loss (P&L) account.

    "But the more of these sideshows that AMP can dispose of and get back to the business of providing profitable financial services to the Australian people, the better off shareholders, their customers and the company is going to be."

    Melbourne law firm Maurice Blackburn Cashman brought the action on behalf of GIO shareholders on a "no win, no charge" basis.

    AMP chief executive officer Andrew Mohl said he was pleased to be bringing an end to the litigation related to the GIO takeover.

    "From AMP's perspective, bringing this matter to an end allows us to focus on issues including our demerger proposal."

    "We believe we have reached a settlement that is in the interests of all parties," Mr Mohl said.

    Suncorp Metway Ltd bought GIO for $1.4 billion from AMP Ltd in September 2001.


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