|  | | 2005 News and Press Releases | | |
SETTLEMENT NEWS:
Ahold Settles Securities Class Action in the United States and Litigation with the Vereniging van Effectenbezitters (VEB); Ahold Takes Q3 2005 Charge After-tax of EUR 585 Million (Excluding Insurance Proceeds)
Staff Writer
PrimeZone. November 27, 2005
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EXCERPT: Koninklijke Ahold N.V. ("Ahold") announced today that it has reached an agreement with the lead plaintiffs to settle the securities class action entitled "In re Royal Ahold N.V. Securities & ERISA Litigation", which is pending before the United States District Court for the District of Maryland, located in Baltimore, Maryland. Ahold also today announced that it has reached an agreement to settle litigation with the Vereniging van Effectenbezitters (VEB) (Dutch Shareholders' Association). Under the terms of the agreement in the securities class action, the lead plaintiffs in the securities class action agree to settle all claims against Ahold in the securities class action for the sum of USD 1.1 billion (EUR 945 million). The settlement covers Ahold, its subsidiaries and affiliates, the individual defendants and the underwriters. The settlement is worldwide and applies to all qualifying common shares of Ahold. The term "qualifying shares" refers to all those common shares which were purchased between July 30, 1999 and February 23, 2003. According to preliminary calculations made by Ahold, the settlement amount, after deduction of plaintiffs' attorneys' fees, compensation in the amount of USD 9 million (EUR 7.5 million) to (an entity designated by) the VEB for facilitating the global settlement and administrative expenses, would yield a pre-tax amount of approximately USD 1.00 to 1.30 per qualifying share (EUR 0.90 to 1.15). US and non-US holders of qualifying shares will be treated equally under the agreement. Ahold will contribute to the settlement fund, from which the qualifying shares will be paid, in two instalments: two thirds of the settlement amount will be funded into escrow within three business days following preliminary court approval of the settlement by the District Court of the District of Maryland, which is expected as early as January 2006, and the remaining one third will be funded into escrow within six months following final court approval of the settlement. The agreement will be subject to approval of the District Court of the District of Maryland. If holders of more than 180 million shares opt out of the settlement (i.e. do not wish to be bound by the settlement), then Ahold will have the right to terminate the agreement and recover the funds paid, other than those amounts spent on notice of the settlement. Under the terms of the agreement between the VEB and Ahold, the VEB has agreed to terminate the proceedings before the Enterprise Chamber of the Amsterdam Court of Appeals with respect to the annual financial statements of the Company for the years 1998, 1999, 2000, 2001 and 2002. In consideration of the withdrawal of such proceedings and as compensation of costs incurred, Ahold shall pay the VEB an amount of EUR 2.5 million. In addition, as part of its commitment to contribute to and facilitate the global settlement, the VEB has agreed that following the publication of the report by the investigators in the so-called inquiry proceedings before the Enterprise Chamber of the Amsterdam Court of Appeals, it will not pursue any further legal action in those proceedings and it will not commence or support a proceeding for damages in any court. |
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