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Nufarm to fight Slater and Gordon class action

Nufarm to fight Slater and Gordon class action

A class action has commenced against agricultural company Nufarm Limited in the Victorian District Registry of the Federal Court of Australia, lead by law firm Slater & Gordon.

The firm is representing investors who acquired Nufarm shares between 2 March 2010 and 31 August 2010.

Slater & Gordon practice group leader, Ben Phi, said the claim was lodged on last week on the instructions of Gaby Hadchiti and Mr and Mrs Graham and Susan Roney, the representative applicants in the proceeding.

The firm was approached by shareholders in July last year in a bid to investigate potential legal action after the company halved its underlying net profit guidance from between $110 and $130 million to between $55 and $65 million.

“The class action filed on Friday alleges that Nufarm's profit forecast for the 2010 financial year provided on 2 March 2010 was misleading and deceptive, in that Nufarm did not have reasonable grounds to forecast underlying net profit of $110 - $130 million,” Phi said.

“Additionally, by failing to revise its profit guidance until 14 July 2010, it is alleged that Nufarm breached its continuous disclosure obligations.”

Nufarm disputes the allegations and said it will contest them.

“The applicants are seeking unspecified and unquantified damages,” the company said in a statement.

“Nufarm denies any and all allegations of wrong doing, and will defend the proceedings vigorously.”

In mid October Slater & Gordon announced that it was expanding the investigation period to include the period to 31 August 2010 after Nufarm’s disclosure on September 1 2010 that its net debt as at 31 July 2010 was substantially higher than previously forecast.

“The class action alleges that Nufarm breached its continuous disclosure obligations by failing to disclose that its net debt was likely to be materially higher than $350 million prior to 14 July 2010,” Phi said.

“It is alleged that Nufarm engaged in misleading and deceptive conduct by forecasting net debt of $450 million on 14 July 2010, when it ought to have been aware that the actual figure would be significantly higher.”

Phi said the claim was an open class action and had been commenced for the benefit of all shareholders that purchased through the relevant claim period, with the exception of any persons who have engaged another solicitor in a potential claim against Nufarm.

The claim is being funded by Comprehensive Legal Funding LLC.

Slater & Gordon has set up a website portal to make it easier for investors to participate in the class action.

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