Tesco is paying $12 million to settle a US case over its £263 million accounting black hole

Tesco on Thursday announced it is paying $12 million (£7.9 million)to settle a class-action suit brought by American investors over its £263 million ($397 million) accounting black hole, which was discovered last year.

Last September Tesco admitted it had misstated profits by £263 million, an admission that sent the share price into freefall. The management team has since been replaced, but the company is still dealing with the fallout.

US law firm Scott+Scott filed a claim against Tesco in the US on behalf of American investors over the collapse in share price.

The supermarket said in Thursday's statement that the settlement includes "no admission of liability."

The case was bought by in New York on behalf of the holders of the Company's American Depositary Receipts (ADR), an instrument that lets US investors back the company. The New York ADR holders make up approximately 2% of Tesco's investor base. A separate case involving Ohio ADR holders, worth 0.2% of Tesco, is still ongoing.

Tesco could still face a similar case in Europe and is the subject of an ongoing Serious Fraud Office investigation and accounting probe.

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