The BISYS Group, Inc., a provider of outsourcing for the financial services sector, said it has reached an agreement in principle with the lead plaintiffs to settle the securities class action lawsuit over certain financial disclosures and restatements filed in 2005 and 2006.
The settlement must be approved by the United States District Court for the Southern District of New York.
Under the proposed settlement, BISYS will pay an aggregate of $66.5 million in cash into an escrow account within 10 days after preliminary court approval. The settlement, which includes no admission of wrongdoing by BISYS or any of the individual defendants, will be funded through a combination of cash on hand, BISYS’s existing credit facility and available insurance proceeds under its $25 million directors and officers liability policy. BISYS is currently in discussions with its insurance carriers to determine the final amount of available insurance proceeds.
“We see this as a significant step forward in putting the company’s financial reporting issues from the past behind us and allowing the Company to focus on growing its business and pursuing opportunities to maximize shareholder value,” said Robert Casale, chairman, and interim CEO and president of BISYS.
The BISYS Group, Inc. provides outsourcing for investment firms and insurance companies. Its Investment Services group provides administration and distribution services for mutual funds, hedge funds, private equity funds, retirement plans, separately managed accounts, and other investment products. Through its Insurance Services group, BISYS is an independent wholesale distributor of life insurance and am independent wholesale distributor of commercial property/casualty insurance, long-term care, disability, and annuity products.
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