Downer EDI

Downer EDI Shareholder Class Action

Omni Bridgeway is funding a class action against Downer EDI Limited (ASX: DOW) (Downer EDI) on behalf of shareholders who acquired Downer EDI shares or an interest in Downer EDI shares between 1 April 2020 and 27 February 2023 inclusive (Relevant Period). 

The class action is being run by law firm Piper Alderman.


Background

Downer EDI is an Australian public company listed on the Australian Securities Exchange under ticker code ‘DOW’ (ISIN: AU000000DOW2). During the Relevant Period, Downer EDI operated a business providing, inter alia, integrated services to customers in Australia and New Zealand including the design, build and maintenance of assets, infrastructure, and facilities across a range of sectors. During the Relevant Period, Downer EDI’s business was organised into divisional Segments, being Transport, Utilities, Facilities, Engineering and Mining.

On 8 December 2022, Downer EDI published an ASX announcement disclosing “accounting irregularities” in its Utilities business involving the misreporting of revenue and work in progress in, what we believe, was one of Downer EDI’s largest Utilities contracts.  Downer EDI also updated its profit guidance to state that it was “now unlikely to be met”, in part, due to the accounting irregularities.

Downer EDI’s share price fell by approximately 20% following the release of the 8 December announcement. 

On 27 February 2023, Downer EDI published restated half-year accounts reflecting its view on, among other things, the economic effect of the accounting irregularities on its financial position.  Together with this restatement, Downer EDI provided updated FY23 guidance.  

Downer EDI’s share price fell by approximately 24% following the release of the 27 February 2023 release.  

Following substantial investigations into the circumstances surrounding the 8 December 2022 announcement and the 27 February 2023 announcement, it is alleged that:
  1. Downer EDI was aware of information concerning the accounting irregularities earlier than 8 December and failed to disclose that information to the market;
  2. Downer EDI historically misrepresented the true state of its financial position; and
  3. until 8 December 2022 and 27 February 2023, Downer EDI’s shares traded at an artificially inflated price. 

Key documents

In accordance with the orders of his Honour Justice Halley of the Federal Court of Australia, please find below the following important documents relevant to the Downer EDI Class Action:


How much will it cost to take part in the class action?

There are no costs involved for group members who wish to take part in the class action. In the event that the class action is unsuccessful, group members do not have to pay anything because Omni Bridgeway will pay any legal costs that may be awarded to Downer EDI. In the event of a successful outcome, Omni Bridgeway will be entitled to reimbursement of the costs of the class action that it has paid plus a commission from the judgment or settlement amount, pursuant to the terms of the funding agreement.