A second Australian firm has come forward to mount a class action on behalf of shareholders of listed legal services giant Slater and Gordon.
Melbourne-based Maurice Blackburn Lawyers today opened registrations to investors who acquired shares since 1 April this year.
Since that time, the share value has dropped by around 90% as Slater and Gordon - which has around 4,000 UK employees - suffered from the fallout of its £637m Quindell acquisition, the government’s proposed reforms of the personal injury sector, and an ongoing investigation by regulators in Australia into accounting practices.
The company issued a statement earlier this month admitting its profit forecasts for 2016 were being downgraded.
Yesterday, Australian firm ACA Lawyers said it would investigate a possible class action, but the Maurice Blackburn intervention takes that commitment one step further.
The latest developments prompted Slater and Gordon Holdings (SGH) to issue a response to the Australian stock exchange, saying it was aware of the firms’ statements but had not been notified of any legal proceedings.
Maurice Blackburn, which calls itself Australia’s ‘number one class actions law firm’, has opened a web portal for shareholders to register their interest and their relevant holdings.
‘We know that poor business decisions or a price drop of themselves don’t satisfy the requirements of launching a class action, but we are now firmly of the view that the activities of SGH require proper scrutiny by the best,’ said Maurice Blackburn principal Jacob Varghese.
‘Shareholders in Slater and Gordon have a right to be profoundly disappointed in last week’s announcement and subsequent further price drop, after having already suffered the company having lost most of its value since April this year.’
Slater and Gordon has said it is confident it will be in a stronger position by the end of the year. The share price dropped by 6.6% to A$0.915 following today’s announcements.