G8 class action settlement receives Vic Supreme Court approval to proceed

G8 Education’s agreement to settle the class action commenced against it by Slater & Gordon, on behalf of shareholders, in November 2020 has been approved by the Supreme Court of Victoria.

The Court’s approval was the last major hurdle required to be passed before the settlement distribution scheme could be completed and the matter closed. 

G8 confirmed on 25 March 2024 that it had agreed to pay current and former shareholders around $46.5 million in compensatory funds in response to a claim brought by Slater & Gordon on behalf of shareholders who suffered financial losses due to alleged failings to disclose material information that was relevant to its 2017 financial performance in a more timely fashion as is expected via its continuous disclosure obligations,

Commenting at the time G8 noted that “the settlement is without admission of liability, with G8’s board determining that a commercial settlement is in the best interests of G8 and its shareholders.” 

In addition the Group highlighted that from a financial perspective there would be no impact to G8’s 2024 results as balance sheet provisions to cover adverse regulatory, legal and other outcomes amounting to $55 million plus indemnity insurance proceeds, more than cover the settlement obligations.

An insurance contribution of circa $11.5 million has now been paid by the Group’s insurers direct to a settlement fund trust account and the remaining settlement amount of circa $35.0 million (net after tax impact estimated to be circa $24.5 million) was paid by G8 in August 2024.