Downer ASX announcement misled investors
14 May 2015; Melbourne, Brisbane
Market Forces, through their lawyers Environmental Justice Australia, have lodged a complaint with the Australian Stock Exchange alleging that an ASX announcement of Downer EDI Limited contained information about the Adani coal mine and port and rail projects that was likely to mislead investors.
“In December last year, when announcing their letter of award from Adani Mining Pty Ltd for the Carmichael Coal Mine contracts, Downer quoted a statement from the CEO of Adani, which claimed the port, rail line and coal mine proposed by Adani would create 10,000 jobs and $22 billion in taxes and royalties for Queensland,” said Julien Vincent of Market Forces.
“Evidence in the Court case in the Land Court of Queensland reviewing the approval of the Carmichael Mine and rail projects, has clearly showed these figures are grossly exaggerated. The evidence, including from Adani’s own experts, indicates the jobs to be created and the royalties that will flow as a result of the project to be about third of the figures quoted in the ASX announcement.”
“We are of the view that these figures would mislead a reasonable investor on the size and scale of the Adani projects, and the likelihood of the project actually getting off the ground. This is relevant to whether Downer will get the contracts.” said Felicity Millner of Environmental Justice Australia.
“Therefore, we think Downer should issue a statement to the market with accurate figures about the Adani projects. We have asked the ASX to require Downer to issue a corrective statement to the market, she said.
“The announcement appeared to effect Downer’s share price. Investors who may have been influenced by the misleading information deserve to be informed of the real situation” said Julien Vincent.
The complaint can be accessed here.