Institutional investors sue Tesco for £100m over allegations of misleading statements

The claim states that the supermarket giant “made misleading statements to the stock market that omitted material information and which were relied on by investors when making investment decisions”.

The action, lodged at the High Court yesterday, is being brought by London-based Stewarts Law and Bentham Europe, a third-party funder.

Sean Upson, a partner at Stewarts Law, said: “Tesco has misstated its accounts, and in particular its treatment of payments from suppliers, to give the appearance of static trading margins. The reality was that those margins were falling.

“Institutional investors were therefore misled when making investment decisions in respect of Tesco. This is precisely the type of wrongdoing which the Financial Services and Markets Act was designed to redress and therefore to prevent”.

Jeremy Marshall, Bentham Europe’s chief investment officer, added: “The misstatement of profits leading to a dramatic collapse in the Tesco share price caused substantial damage to many shareholders who manage money for thousands of investors.

“Investors have a right to rely on statements made by companies to ensure that they correctly allocate capital. The claim will assert that Tesco’s misstatements are in clear breach of its obligations under the Financial Services & Markets Act and investors must be compensated.”​