DIERCKX & ASSOCIATES LTD

Internet firm World Online, ABN Amro and Goldman Sachs did mislead investors at the internet service provider’s launch on the Amsterdam stock exchange in 2000, the Supreme Court (Hoge Raad) ruled on Friday.

WOL shares started trading at €50 but had halved in price two weeks later and were under €10 at the end of the year. It later emerged WOL owner Nina Brink a well known Dutch business woman with a reputation, had sold most of her shares before the IPO for just $ 6.04 a share. The Supreme Court decided Friday that Nina Brink had given ‘the wrong impression’ about her share ownership before the launch and the price she sold her shares at should have been mentioned in the prospectus. ABN Amro and Goldman Sachs failed in their duties as lead managers of the flotation to correct this impression and painted “too rose-coloured” a picture of World Online’s prospects, the Supreme Court said.

Settlement

Shareholders lobby group VEB said the court ruling was a ‘resounding victory‘ for shareholders and hoped there would now be an ‘acceptable’ settlement for shareholders who lost money. The organisation, which launched the legal action in 2001, estimates shareholders lost a total €2.3bn.

WOL was the first Dutch internet service provider and its stock exchange launch in March 2000 was at the height of the dotcom boom.  The IPO was accompanied by a huge advertising campaign and media hype. Brink was said to have persuaded a number of her influential friends to buy in to the company reportedly including  Tina Turner.

Sources

• Dutchnews.nl
• FEM

Filed under: HEADLINES, LAW