BHP shares fall after Fundão Dam class action settlement
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More news: BHP shares lowered this morning after the mining giant agreed to settle a class action brought on behalf of shareholders who acquired shares in the miner before the Fundão Dam disaster in 2015.
Shares were down 0.8% to $41.05 at 11:20am AEST, having added 5.9% over the last 12 months.
Law firm Phi Finney McDonald said the $110 million settlement, brought in relation to BHP’s market disclosures about the Fundão dam in Brazil, follows seven years of "hard-fought litigation".
The class action sought recovery of investor losses, alleging breach of disclosure obligations and misleading and deceptive conduct following the Fundão dam collapse in November 2015.
The allegations related to whether there was proper disclosure to the ASX about any knowledge of the dam failure risks and the potential for serious adverse human, environmental and financial consequences.
It was also alleged BHP had engaged in misleading and deceptive conduct by claiming safety was its highest priority and had in place effective systems and processes in place to identify and manage risks to people, the environment and communities across its operations and subsidiaries, including the Samarco mining operation.
BHP denied the allegations made in this proceeding, and the conditional settlement does not constitute any admission of liability.
What they said: “This is a significant outcome for BHP investors,” said Phi Finney McDonald principal lawyer Brett Spiegel.
“It is one of the few settlements to exceed $100 million in Australian shareholder class action history.
“It comes on the eve of the 10th anniversary of the Fundão dam collapse that devastated downstream communities and the surrounding environment.”
BHP settles shareholder class action over Fundão Dam disaster
The news: BHP has agreed to settle a class action brought on behalf of shareholders who acquired shares in the miner before the Fundão Dam disaster in 2015.
The numbers: The mining giant will pay the applicants $110 million, inclusive of interests and costs, with no admission of liability.
The context: BHP said it expects to recover the majority of the settlement from its insurers.
The class action was filed in the Federal Court in 2018 on behalf of shareholders who acquired shares in BHP between 8 August 2012 and 9 November 2015.
The Fundão dam was owned by Samarco — a joint venture between BHP and NYSE-listed miner Vale. Its collapse killed 19 people and caused a giant mudslide that uprooted homes and villages.
BHP agreed to pay a settlement of $48 billion to Brazilian authorities in 2024 in relation to the failure.
The source: ASX
