Benzinga | Apr 30, 2021 04:34PM EDT

Granite Reaches Agreement To Settle Pending Class Action Lawsuits; Granite Will Pay Or Cause To Be Paid $129M In Cash

Granite Construction Incorporated (NYSE:GVA) ("Granite" or the "Company") today announced that it entered into a stipulation and agreement of settlement (the "Settlement Agreement") to settle the previously disclosed securities class action litigation filed in the United States District Court for the Northern District of California titled Police Retirement System of St. Louis v. Granite Construction Incorporated, et al., which was filed in August 2019. The Settlement Agreement also settles claims alleged in the putative class action lawsuit filed in the Superior Court of California, County of Santa Cruz titled Nasseri v. Granite Construction Incorporated, et al., which was filed in October 2019. The Settlement Agreement is subject to approval of the court.

Under the terms of the Settlement Agreement, Granite will pay or cause to be paid a total of $129 million in cash, $63 million of which it expects to be paid through insurance proceeds to settle these lawsuits. The Settlement Agreement contains no admission of liability, wrongdoing or responsibility by any of the parties.

"We are pleased to have reached an agreement to resolve these matters and believe doing so is the right business decision for Granite and our shareholders," said Kyle Larkin, Granite President. "While we are confident in the facts and the merits of our position, we believe it is prudent to end this protracted and uncertain class action litigation process and focus on doing what we know best - driving the business forward. Importantly, our balance sheet and liquidity remains in a strong position following the settlement."

As previously disclosed, the Company had not been in a position to reasonably estimate the range of potential loss in connection with the lawsuits. As a result of the entry into the Settlement Agreement, the Company expects to recognize a pre-tax charge of approximately $66 million in the quarter ending March 31, 2021.

The previously disclosed shareholder derivative lawsuit filed in the United States District Court for the Northern District of California remains pending.