The Henderson fund management group is being sued for up to £450m in damages by a group of investors including Tesco and the BBC over its £1bn acquisition of John Laing, the construction conglomerate.
The action, brought by a total of 23 of the UK's largest pension schemes, is unprecedented in its nature and scope and concerned the City, which sent Henderson Group's shares down by more than 3 per cent.
BAE Systems, the defence giant, and Bupa, the private healthcare provider, are also among the pension funds suing Henderson for hundreds of millions of pounds.
The case centres around the 2006 acquisition of John Laing by the Henderson PFI Secondary Fund II LP, which raised £573.5m with a remit to focus on so-called private finance initiatives, where public infrastructure projects are funded with private capital.
Shortly after raising the fund, Henderson bought John Laing following a bidding war with Allianz, the insurer, at a price now seen as being inflated.
The investors in the Henderson fund argue that the John Laing deal did not satisfy the mandate to focus on PFI projects and are suing to cover the losses incurred on the deal. They are seeking £170m to cover the loss on the fund – which reached as high as £380m in 2009 – as well as the profits they believe they would have made had the money been invested in a genuine PFI project.
Henderson said: "We have considered these complaints carefully. We are confident that we have no legal liability to investors in this fund. We will vigorously defend these proceedings.".