Robbins Arroyo LLP: GreenSky, Inc. (GSKY) Misled Shareholders According to Class Action
SAN DIEGO & ATLANTA--(BUSINESS WIRE)--Nov 19, 2018--Shareholder rights law firm Robbins Arroyo LLP announces that purchasers of GreenSky, Inc. (NasdaqGS: GSKY) have filed a class action complaint against the company’s officers and directors for alleged violations of the Securities Act of 1933 pursuant to the company’s May 2018 initial public offering (“IPO”). GreenSky, a technology company, provides point-of-sale financing and payment solutions to merchants, consumers, and banks.
View this information on the law firm’s Shareholder Rights Blog: https://www.robbinsarroyo.com/greensky-inc/
GreenSky Accused of Depleting Company Assets Ahead of IPO
According to the complaint, prior to the IPO company insiders caused Greensky to enter into a series of special cash distribution agreements, which resulted in the distribution of over $581 million. Company insiders also caused Greensky to enter into an agreement that provides for the distribution of 85% of the tax savings the company realizes as a result of the reorganization transactions that preceded the IPO, which was estimated at $928 million.
GreenSky held its IPO on May 29, 2018, generating over $1 billion in gross proceeds, based on a misleading Registration Statement. The misinformation came to light when GreenSky began reporting dismal financial results less than three months later on August 7, 2018, citing a merchant business mix shift from solar panel merchants to merchants in the elective healthcare industry. Consequently, GreenSky was subject to an increased risk that its earnings growth would suffer and its adjusted EBITDA would decline in a high interest rate environment. GreenSky again reported disappointing results and lowered its guidance on November 6, 2018, revealing the company’s adjusted EBITDA represented a 46% sequential decline and a 35% year-over-year decline as compared to the company’s fourth quarter 2017 results. On this news, GreenSky’s Class A shares fell to $9.28 per share on November 6, 2018, nearly 60% below the company’s IPO price.
GreenSky Shareholders Have Legal Options
Concerned shareholders who would like more information about their rights and potential remedies can contact attorney Leonid Kandinov at (800) 350-6003, LKandinov@robbinsarroyo.com, or via the shareholder information form on the firm’s website.
Robbins Arroyo LLP is a nationally recognized leader in shareholder rights law. The firm represents individual and institutional investors in shareholder derivative and securities class action lawsuits, and has helped its clients realize more than $1 billion of value for themselves and the companies in which they have invested. Sign up for our FREE portfolio monitoring service, Stock Watch.
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View source version on businesswire.com:https://www.businesswire.com/news/home/20181119005809/en/
CONTACT: Leonid Kandinov
Robbins Arroyo LLP
600 B Street, Suite 1900
San Diego, CA 92101
(619) 525-3990 or Toll Free (800) 350-6003
KEYWORD: UNITED STATES NORTH AMERICA CALIFORNIA GEORGIA
INDUSTRY KEYWORD: PROFESSIONAL SERVICES LEGAL
SOURCE: Robbins Arroyo LLP
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PUB: 11/19/2018 03:46 PM/DISC: 11/19/2018 03:46 PM