Brazilian state-run oil company Petróleo Brasileiro SA, or Petrobras, said Monday its board has agreed to settle a shareholder lawsuit by The Vanguard Group to recover corruption-related losses.
Though it didn't disclose the terms of the agreement, Petrobras said it will raise its financial provision for settlements with shareholders to $445 million from $372 million.
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Vanguard is one of Petrobras's largest shareholders, after the federal government and other agencies of the Brazilian state, the company added.
The oil company has been the target of more than two dozen lawsuits by shareholders in recent years as a result of a massive corruption scheme in which Petrobras executives took bribes from contractors who had overcharged the company for work. The company says it was a victim of the graft.
While Petrobras has managed to settle with most of the shareholders out of court, a class-action suit in which plaintiffs claim tens of billions of dollars in damages remains active in New York federal court.
"At the moment, it isn't possible for Petrobras to make a reliable estimate as to the outcome of the class action," the company said.
The Vanguard lawsuit held that Petrobras relied heavily on U.S. securities markets to fuel an ambitious growth plan and "assured investors that it would be transparent and responsible in managing that growth." Instead, it hid the corruption scheme and "massively overstated its assets and profitability," leaving shareholders with huge losses after the advertised growth failed to materialize, the suit said.
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(END) Dow Jones Newswires
June 19, 2017 18:51 ET (22:51 GMT)