Macmahon pays $6.7m settlement

Mining contractor Macmahon Holdings has agreed to pay a $6.7 million settlement for a class action related to cost overruns at a construction project in 2012.

The legal action was launched in the Federal Court in 2015 by shareholders concerned about market disclosure by Macmahon regarding cost increases at a project with iron ore miner Rio Tinto in the Pilbara.

Macmahon said the settlement came without admission of liability.

“The decision to settle was a purely commercial matter, taken in the best interests of our shareholders,” chairman Jim Walker said.

“Macmahon continues to deny any wrongdoing in this matter and it is important to note that the settlement is not an admission of any liability, nor a finding against the company or any individuals.

“Resolving this historical matter in this way permits management to focus on the ongoing business of the company, without the risk, distraction or expense of a lengthy trial.”

The company said the payment would not impact underlying earnings, as it will be recorded as a one-off charge to its income statement.

Shares in Macmahon were up 1.89 per cent at 27 cents each at 3.40pm AEDT.