(Nederlandse versie)
Last week, it was announced that Shell has also reached a settlement with US investors covering the problems surrounding the 2004 adjustment of the company’s proven oil reserves. The VEB is pleased to learn that the legal conflict can now come to an end in the US as well, with US investors being compensated for the loss they suffered in a manner equal to those domiciled outside the US.
Additional $28 million plus interest for European investors
The new settlement also means good news for investors not domiciled in the United States: an additional amount of some $28 million will be available for distribution outside the US. Furthermore, all affected investors will be paid interest, with effect from 1 April 2008, on the compensation amount they are entitled to. The additional compensation results from the agreement the VEB reached with Shell to cover a potential situation in which US investors receive higher compensation than those not domiciled in the United States. Prior VEB settlement
Previously, on 11 April 2007, the VEB had reached a settlement in this case outside the US, together with other affected investors. The outcome of that settlement was that an amount of $340.1 million would be made available by Shell to affected investors not domiciled in the United States. On top of this amount, private investors would each receive a fixed amount of some $130 (or some €85) for their application. The parties have meanwhile lodged an application with the Amsterdam Court of Appeals, requesting that the settlement be declared binding for all shareholders it covers. The VEB is confident that the Court will grant the application this year, which means that, following the claims submission period, a start can be made with making compensation payments to affected shareholders as soon as possible. Current expectations are that this will be in 2009. The main points of this settlement reached outside the US are the following:
- Shell will pay $340.1 million to those investors not domiciled in the United States who purchased shares outside the US during the 8 April 1999 - 18 March 2004 period. The amount will be distributed pro rata to the number of shares reported.
- Shell will also make available an additional $12.5 million to encourage private investors to participate in the settlement and the compensation scheme. This amount will be allocated equally among those investors submitting a valid claim. Current estimates suggest this means every investor taking part in the scheme will receive a fixed payment of some $130 (€85).
- An additional $35 million will be available for distribution among all affected investors. This will result in an additional amount of some $28 million being made available to investors domiciled outside the US.
- With effect from 1 April 2008, interest will be paid on the compensation to which the affected investors are entitled.
- The VEB and the institutional investors affected will drop all current and future legal proceedings against Shell relating to the reserves issue.
- Shell will request that the SEC distribute to investors the $120 million penalty Shell paid in 2004 under the compensation scheme. If the SEC grants Shell’s request, some 80% of this amount will go to investors domiciled outside the US.
In reaching this settlement, the VEB has drawn upon the international confederation Euroshareholders, to which it is affiliated, which gathers 29 shareholder associations all over Europe.The VEB will keep you informed about this case on its website shellcompensation.com, which allows shareholders to register and provides updates on the settlement and its finalisation.