Tesco has been slapped with a £129m fine by the Serious Fraud Office, over false accounting issues from three years ago.
The supermarket has entered into a deferred prosecution agreement with the SFO, meaning the group will not be prosecuted on condition it fulfils certain requirements, including payment of the fine. Tesco shares were down 0.53 per cent in morning trading.
The fallout from the accounting scandal, in which Tesco admitted to a £250m black hole in its finances, has rumbled on since it emerged in 2014. So how did the City feel about today's announcement?
Slap on the wrist
"This is a big slap on the wrist for Tesco, reflecting the seriousness of the offence and its impact on the share price in 2014," Laith Khalaf, senior analyst at Hargreaves Lansdown.
"Investors will be pleased that compensation is now going to be issued to those who bought shares in the supermarket at an inflated price, based on false information.
"This kind of accounting error is exceptionally rare in the UK stock market, nonetheless shareholders in all companies will be heartened to learn that in instances where false information is provided to the market, the regulator will see to it that investors are duly compensated."
Khalaf added: "Dave Lewis underwent a baptism of fire when he took over as CEO in 2014, just as the accounting scandal struck."
He and the supermarket will now be hoping to draw a line under the matter, and concentrate on nurturing Tesco’s nascent recovery.
After the scandal emerged in 2014, Tesco's share price dropped by almost 17 per cent.
Analysts at Shore Capital said they welcomed the announcements of these agreements between Tesco and the UK authorities.
"We believe that Dave Lewis engaged in corporate wonders in keeping Tesco stable at the time of this crisis and all shareholders should be thankful for his skills in navigating the business through the most choppy of waters," they continued.
The announcement of the settlements brings to an end, hopefully, a damaging chapter for the business so allowing for further focus on the current day job
"The latter, of course, now includes potentially more distraction, to our minds, with the proposed merger with Booker, on which we await the wisdom of the UK Competition & Markets Authority. In this respect we note with interest some dissenting institutional investor voices on this deal whilst we wonder quite whether Booker's share register today has the same composition as it did ahead of the surprise 'merger' announcement."