A class action has been filed against engineering and infrastructure company RCR Tomlinson on behalf of aggrieved shareholders.
RCR went into a trading halt on July 30, 2018 and on August 28 it disclosed operational issues relating to two solar farm projects in Northern Queensland, which led to substantial cost overruns and a net loss for RCR for the 2018 financial year.
On August 30, 2018, RCR shares were reinstated to the ASX. The share price fell by more than 60 per cent – from $2.80 to $1.05 – wiping out hundreds of millions of dollars of shareholder value.
Last week, the Electrical Trades Union seized on reports that RCR announced a second trading halt as evidence the company was in danger of going into receivership.
The legal proceedings were filed by litigation firm Quinn Emanuel Urquhart & Sullivan (Quinn Emanuel) RCR Tomlinson Limited (ASX: RCR) (RCR) November 16, 2018, in the Supreme Court of New South Wales.
Related article:Union calls for commitment after RCR solar halt
Quinn Emanuel will pursue the class action with financing from Burford Capital (Burford), a global finance firm focused on law.
Partner at Quinn Emanuel Damian Scattini said, “It’s unlikely that the recent alarming disclosures by the company could have come as a surprise to management – if they did, that’s worse. RCR shareholders have seen a catastrophic decline in their share value.”
Managing director of Burford Craig Arnott said, “Burford is glad to provide financing that enables Quinn Emanuel’s first-rate team to seek redress for shareholders, so that they can recover the value of their investment as quickly and cost effectively as possible.”
Shareholders who acquired shares in RCR between August 11, 2017 to July 27, 2018 can register their claim with Quinn Emanuel by calling 1800 927 703, or by emailing email@example.com.
Projects of RCR Tomlinson’s include the recently completed Gannawarra and Wemen solar farms, and Daydream and Hayman solar farms.
An RCR Tomlinson spokesperson told ES&D NewsRCR intends to defend the class action.