Fairfax Media | 12 November 2014
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More than 30 institutional investors from both Australia and overseas are backing a class action being planned by law firm Maurice Blackburn over disclosure practices at embattled education firm Vocation.
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Maurice Blackburn has launched online registration page to allow retail shareholders to sign up to be part of a class action, joining the large institutions angry at the heavy losses of $350 million-plus as the share price plunged.
Maurice Blackburn class actions principal Jacob Varghese said there had been substantial interest from institutional investors in pursuing a class action, and the firm would be undertaking further investigations with a view to formally commencing proceedings by late calendar 2014 or early next year.
“It’s very clear there’s a fair degree of disquiet about what’s happened here,” he said.
The 30-plus institutions represented the interests of hundreds of thousands of investors in those funds. Retail investors in Vocation would now be given the opportunity to join the action.
Vocation shares went into freefall after the company announced to the ¬market on October 27 it would be stripped of $19.6 million in funding and would take a $5 million hit to its bottom-line profits in 2014-15, having previously advised the market that the impact of an audit review by Victorian regulators would not be material.