Ahold signs off on $297 million settlement
Ahold signs off on $297 million settlement
Ahold has agreed to settle a pending class action lawsuit in respect to pricing practices of Ahold's former subsidiary U.S. Foodservice. Ahold has agreed to make a payment of $297 million to resolve the issue.
Although U.S. Foodservice, now U.S. Foods, was sold in a $7.1 billion deal in July 2007, a condition of the sale was that Ahold maintained responsibility for damages arising out of this class action, referred to in Ahold's annual reports as the "Waterbury litigation."
"We are pleased to have reached this settlement, which resolves a legacy litigation since 2006 related to our former subsidiary U.S. Foodservice," Lodewijk Hijmans van den Bergh, member of the Ahold management board and chief corporate governance counsel, said in a press release. "The settlement permits us to avoid more lengthy, time-consuming and costly litigation, and to focus our resources and attention to our current business."
The settlement is subject to approval by the United States District Court for the District of Connecticut. Ahold will be funding its payment to the settlement fund out of its available cash balances and expects this payment to take place in late 2014 or the beginning of 2015.