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Supermarket forced to give cash back to certain investors after misrepresenting its accounts
Thursday 30 Mar 2017 Author: Tom Sieber

Anyone who bought shares in Tesco (TSCO) during a certain part of summer 2014 may be able to get some money back as a compensation payment.

Tesco has agreed a settlement with the Serious Fraud Office (SFO) over accounting malpractice where it overstated profits.

The Financial Conduct Authority (FCA) has used its powers to force Tesco to deliver £85m worth of compensation to shareholders.

How much will it cost?

In total Tesco is taking an exceptional charge of £235m in respect of the SFO fine, FCA compensation scheme and related costs.

The market abuse identified by the FCA relates to a trading update on 29 August 2014 which overstated profit. This was followed by a corrective statement on 22 September 2014.

Tesco will pay 24.5p per share and interest (covering the period in the interim) based on 4% annual rate to retail bondholders who invested between 29 August and 19 September 2014.

The scheme is being run by KPMG, with oversight from the FCA, and should be established by August upon which you will have six months to make a claim.    Click here for more detail.

Booker deal bashed

Tesco is also under fire from two major shareholders owning 9.5% of the company. They are trying to block its £3.7bn acquisition of wholesaler Booker (BOK), implying it could destroy shareholder value.

We expect Tesco will defend the Booker deal when it reports full year results on 12 April. (TS)

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