Tesco shareholders set for claim battle

Tesco is facing further woes as its recovery gets underway
Tesco is facing further woes as its recovery gets underway

A top lawyer who defended the last change of ownership of Liverpool Football Club has been retained by Tesco shareholders who claim they were misled over the supermarket’s £326 million profits misstatement.

The Tesco Shareholder Claims (TSC) group, backed by US law firm Scott + Scott, said it had a strong case that will involve a “substantial claim”.

The group, which was launched in March, said the revenue overstatement last year had caused a permanent destruction of value to shareholders.

It said when the misstatement was admitted on September 22, shares fell to a 14-year low of 164.8p, although they have since recovered to around 215p.

The group claim is expected to be in the region of 50p to 70p a share. Tesco , which declined to comment, has over eight billion shares listed, which means the proposed claim could run into billions of pounds.

The scandal, involving rebates from suppliers being brought forward in the company’s accounts, came just as new CEO Dave Lewis took over as sliding sales prompted the departure of predecessor Philip Clarke.

John Bradley, chairman of TSC, said: “With the benefit of the advice received from Philip Marshall QC we believe we have a strong case and we wish to pursue it vigorously.”

Among a number of high-profile cases Mr Marshall defended the 2010 sale of Liverpool to Fenway Sports Group (then New England Sports Ventures) against a challenge from former owners Tom Hicks and George Gillett.