Tesco agrees $12 million payout after lawsuit

Tesco agrees $12 million payout after lawsuit

Tesco (NASDAQ:TESO) has announced that it will pay out $12 million to settle a lawsuit by US shareholders, who claimed that the company had overstated its profit expectations for 2014.

Tesco, the UK’s largest supermarket, admitted it had overstated its profit guidance due to incorrectly booking payments from suppliers, sending US shares tumbling by 15 percent. The overstatement was estimated to be around £263 million.

In a spate of bad results for the major supermarkets, Tesco reported third quarter earnings last month with a 55 percent fall in half-year operating profits.

Tesco’s US-listed shares are currently trading down 2.42 percent at 8.08 a share. (0934GMT)