Set­tling for $ 95m

Am­cor, Visy close price fix­ing class ac­tion

Townsville Bulletin - - Investor -

CARD­BOARD box man­u­fac­tur­ers Am­cor Ltd and Visy Board Pty Ltd will pay out at least $ 95 mil­lion to thou­sands of busi­nesses af­ter set­tling a drawn-out class ac­tion over al­leged price fix­ing.

The sett le­ment c o mes al­most five years af­ter the class ac­tion be­gan, on be­half of 4500 busi­nesses seek­ing dam­ages from the al­leged car­tel be­hav­iour by Am­cor and Visy.

One mem­ber wel­comed the set­tle­ment, but said the ac­tion was about more than money.

Filed by law firm Mau­rice Black­burn, the ac­tion al­leged that be­tween Jan­uary and April 2000, Am­cor and Visy en­tered into a car­tel to fix cor­ru­gated fi­bre­board pack­ag­ing prices and re­duce competition for each other’s cus­tomers.

The first car­tel ar­range­ment spread via sec­ondary agree­ments to see some prices in­creased each year from 2000 to 2003 for non­con­tract cus­tomers, it was al­leged.

Am­cor is to pay two thirds of the set­tle­ment fig­ure and Visy the re­main­der, but the agree­ment also in­cludes the pay­ment of all legal costs, mean­ing the bill for each com­pany will be sig­nif­i­cantly higher.

Am­cor told the Aus­tralia Se­cu­ri­ties Ex­change it would pay $ 63.3 mil­lion of the set­tle­ment, plus in­ter­est of $ 25.6 mil­lion.

The sum of legal costs will be de­ter­mined by the court.

The set­tle­ment still re­quires court ap­proval, with the next hear­ing sched­uled for March 24.

In­volved in the class ac- tion were gro­cery and veg­etable sup­pli­ers, in­dus­trial com­pa­nies, meat and poul­try pack­ers, dairy com­pa­nies and con­sumer goods sup­pli­ers.

One mem­ber of the ac­tion was Greg Worth, a North Queens­land ba­nana farmer and for­mer owner of ba­nana pack­ing busi­ness Aus­tralian Ba­nana Com­pany.

He said the pay­out would be ben­e­fi­cial, given al­most his en­tire crop was wiped out by Cy­clone Yasi.

‘‘ I am happy there is com­pen­sa­tion for small busi­nesses and farm­ers, par­tic­u­larly in North Queens­land, where funds com­ing in will be wel­come af­ter the nat­u­ral dis­as­ters of this year,’’ Mr Worth said. ‘‘ I joined this ac­tion for rea­sons other than money. It is the prin­ci­ple of it too.

‘‘ If these big com­pa­nies col­lude and make prof­its at other peo­ple’s ex­pense, they have to be held ac­count­able,’’ he said.

Am­cor shares out­per - formed a sig­nif­i­cantly weaker mar­ket yes­ter­day, los­ing one cent to $ 6.98.

DRAWN-OUT PROCESS: 4500 busi­nesses will ben­e­fit from the set­tle­ment

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