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Action “seeks to recover damages against Defendants for alleged violations of the federal securities laws”
Pomerantz LLP has filed a class action lawsuit against MOL Global (Nasdaq:MOLG) and certain of its officers. The class action, filed in United States District Court, Southern District of New York, and docketed under 14-cv-09357, is on behalf of a class consisting of all persons or entities who purchased MOL Global securities between October 9, 2014 and November 20, 2014, inclusive.
This class action seeks to recover damages against Defendants for alleged violations of the federal securities laws under the Securities Exchange Act of 1934.
MOL Global, Inc., through its subsidiary, MOL AccessPortal Sdn. Bhd., provides e-payment solutions for online goods and services in Southeast Asia.
The Complaint alleges that throughout the Class Period, Defendants made false and/or misleading statements and/or failed to disclose to MOLG investors that: (1) MOLG was overstating the revenue and profit derived from MOLG’s business and operations; (2) MOLG’s actual business model could not sustain the growth trends described in the Offering Documents; (3) MOLG would not be able to report its third quarter 2014 financial results on November 21, 2014, as previously stated; and (4) as a result of the foregoing, MOLG’s financial statements were materially false and misleading at all relevant times.
On October 3, 2014, MOLG filed its amended Registration Statement for the IPO, which became effective on October 8, 2014. Pursuant to the IPO, 13,500,000 ADSs were sold, consisting of 7,485,030 ADSs offered by the Company and 6,014,970 ADSs offered by certain selling shareholders of the Company, at the price to the public of $12.50 per ADS.
On November 20, 2014, prior to the opening of the market, Deutsche Bank, which had previously assisted in the Company’s IPO, assumed coverage on MOL in a research note setting a “buy” recommendation and a $12.00 price target on the stock. Deutsche Bank’s price objective pointed to a potential upside of 49.44% from the ADSs’ previous close.
On November 20, 2014, after the market closed, little more than forty days after the Company’s IPO, MOLG announced “that the Company has rescheduled the date it plans to release its third quarter 2014 financial results to Wednesday, December 3, 2014 before market opens.” The Company had previously announced that it would issue the results on November 21, 2014. Shockingly, the Company also announced after the CFO had abruptly resigned “for personal reasons.”
On November 21, 2014, just a day after issuing a “buy” recommendation, Deutsche Bank advised investor caution about shares in MOLG, describing MOL’s sudden announcement as “potentially ominous.”
On this news, shares of MOLG declined $4.77 per share, or almost 54%, to close at $4.09 per share on November 21, 2014, on unusually heavy volume. This represented a 67% decline in MOLG’s ADS price from the IPO price of $12.50.
