They thought it was all over. It is now. Almost. A small group of Royal Bank of Scotland shareholders who have yet to accept a settlement over the bank’s 2008 rights issue have been given until July to prove that they can fund the continuation of their claims — although the indications last night were that they, too, were preparing to accept the offer.
In the High Court, Judge Robert Hildyard called off a trial of the long-running lawsuit against RBS, allowing Fred Goodwin, the former chief executive, to avoid a court appearance to answer questions over his role in the £12 billion rights issue.
“In a difficult and novel situation, the process of bringing an end is not as easy as might be thought,” the judge told the court. “It is the mark of a settlement that neither side should feel it is correct.”
He confirmed that a minority of claimants who had not yet accepted the 82p-a-share offer of compensation could apply for the trial to be held if they could provide sufficient proof of funding to continue with their claim.
A spokesman for RBS played down the likelihood of that happening, however. “Eighty-seven per cent of the remaining claimants by value have accepted the settlement offer and the trial has now been vacated. This includes the action group, which represents the individual retail claimants. The offer remains open for acceptance for a short period to the further 13 per cent. It was made clear that this delay is the result of procedural issues. None of the outstanding claimants have indicated any intention to continue the claim.”
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Jonathan Nash, QC, acting for the RBS Shareholder Action Group, also indicated to the judge that he believed that most, if not all, of the remaining claimants were preparing to accept RBS’s offer.
In a case that had begun five years ago, RBS shareholders had argued that the bank had misled them about its health when it launched the rights issue in April 2008. Only six months later, the bank had to be rescued by a £45.5 billion taxpayer bailout.
RBS has always denied the claims and it reiterated yesterday that the settlements agreed had been reached without any admission of liability.
The original claims, which were being pressed by four main shareholder action groups, amounted to about £4 billion, although in December last year all but the RBS Shareholder Action Group had accepted an offer of 41.5p per share. In April this year, 40 per cent of the remaining group accepted a slightly higher offer, leaving about 20 institutions and 9,000 retail investors to press ahead with a claim for £550 million, or £800 million with interest. Yesterday’s settlement means that they will receive £200 million of the main claim and no interest.
A spokesman for the RBS Shareholder Action Group said: “Our resolve to press on has been vindicated by this settlement, which is twice that accepted by others who had much greater resources than us.”
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Most shareholders paid at least 200p a share in the rights issue. RBS shares closed up nearly 3½p at 255¼p.
