Lawyers circle Domain in potential class action lawsuit
HIGH powered class action lawyers are keeping a “watchful eye” on Domain after the shock exit of its chief Antony Catalano sparked a plunge in the company’s value.
The resignation of Mr Catalano for family reasons, only two months after Domain listed, caught the market off- guard. The revelation ripped $328 million off Domain’s market capitalisation on Monday after its shares plunged 17.2 per cent. Yesterday the stock bounced back by 9.09 per cent to $3.
Although Domain’s market value was still down $184 million since Mr Catalano revealed his resignation. The company has now lost 21 per cent of its value, or $396 million, since being spun out of media player Fairfax in November last year.
It is also believed the corporate cop, the Australian Securities and Investments Commission, is keeping an eye on the matter. Asked whether the sudden departure only eight weeks after it hit the Australian share market could lead to a class action, law firm William Roberts Lawyers said it was watching the situation. “(We are) aware of the recent announcements associated with Domain Holdings, together with the price movements,” the company said in a statement. “We are keeping a watchful eye on the company.” William Roberts have previoously run class actions against Spotless, Downer EDI and ABC Learning.
It is believed Mr Catalano only revealed the decision to the board after he came back from his Christmas break and they quickly moved to tell the market. But the surprise exit only eight weeks after the real estate classified business listed has angered some investors. The Australian Shareholders Association says the controversy raises questions about why these discussions did not occur at the time of the float.