VNT -22.56% & DOW -5.95%: A tough day for both, though Ventia was the harder hit given the allegations are more influential to them. The ACCC announced civil proceedings against divisions of both companies as well as targeting four senior executives, for “alleged price fixing relating to estate maintenance and operation services for the Department of Defence. Both firms provide services to Department of Defence under separate billion-dollar contracts.
- Ventia is reviewing the detail of the allegations and at this stage does not intend to comment further on the proceedings.
- Downer EDI “categorically denies” the allegations and will “vigorously defend any proceedings.”
We covered VNT yesterday (here) as an interesting stock to watch and today shares fell ~20%. These accusations are significant, more so for VNT than DOW – Downer actually looks more interesting into the weakness.
MM has turned neutral on VNT, awaiting more information
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