Dutch shareholder lobby group VEB said Wednesday it is close to reaching a final settlement with banks related to the initial public offering of World Online, a flotation that went sour after the dot-com bubble burst in 2000.

The VEB, which says it represents around 12,000 shareholders, said the banks have agreed to pay compensation of up to EUR120 million for the losses incurred in the period after the IPO of the former Dutch internet company.

The group said it has reached a "broad agreement" with banks, which include Goldman Sachs Group Inc. (GS) and Royal Bank of Scotland PLC (RBS)--the legal successor of Dutch bank ABN Amro that led the IPO at the time, and that a final deal is expected within a couple of months.

World Online was listed in March 2000 at an introductory price of EUR43, just when the technology stock bubble burst. The stock opened its first session at EUR50.20, but collapsed in the course of the year to below EUR10, partly because it became known that the firm's chief executive at the time, Nina Brink, had sold her stock prior to the IPO.

The internet firm was later taken over by Italy's Tiscali SpA (TIS.MI).

The settlement follows a ruling from the Netherlands' highest court last year, which said that World Online and the banks accompanying the IPO had been too optimistic about the value and future prospects of the internet company.

Goldman Sachs and Royal Bank of Scotland weren't immediately available for comment.

- By Maarten van Tartwijk; Dow Jones Newswires; +31 20 571 5201; maarten.vantartwijk@dowjones.com
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