He added: “This is a big slap on the wrist for Tesco, reflecting the seriousness of the offence and its impact on the share price in 2014.
“Investors will be pleased that compensation is now going to be issued to those who bought shares in the supermarket at an inflated price, based on false information.
“This kind of accounting error is exceptionally rare in the UK stock market, nonetheless shareholders in all companies will be heartened to learn that in instances where false information is provided to the market, the regulator will see to it that investors are duly compensated.”
Meanwhile, the supermarket was also fighting off opposition from Schroders and Artisan Partners, who jointly own 9% of the company, requesting the group drop its proposed £3.7bn purchase of wholesaler Booker.
Co-head of the Schroders global value team and manager of the Schroder UK Income fund, Nick Kirrage, expressed concerns in a letter to Tesco chairman John Allan that the deal was not a good value proposition.
“We believe the high price being paid for Booker makes the destruction of value even more likely,” he said.
“From 2007 to 2016, Booker’s profits have increased from £36m to £153m and amrgins have risen from 1.2% to 3.1%; both are now at their highest ever levels.
“Tesco is paying over 23 times this peak operating profit, a multiple which will make the creation of shareholder value extremely challenging.”
Despite the fireworks on the day, shares in the British food retailer had recovered by mid-morning from their 0.8% drop twenty minutes into trading, and were up slightly by 0.03% at 190p.
