World News: 00:00 GMT Friday 15th March 2019. [Pomerantz LLP via Globe Newswire via SPi World News]
NEW YORK, March 14, 2019 (GLOBE NEWSWIRE) -- Pomerantz LLP announces that a class action lawsuit has been filed against Conagra Brands, Inc. (“Conagra” or the “Company”) (NYSE: CAG) and certain of its officers and directors. The class action, filed in United States District Court, Northern District of Illinois, Eastern Division, and indexed under 19-cv-01805, is on behalf of a class consisting of all persons and entities, other than Defendants and their affiliates, who purchased, or otherwise acquired, Conagra common stock from June 27, 2018 through December 19, 2018, inclusive (the “Class Period”), seeking to pursue remedies under the Securities Exchange Act of 1934 (the “Exchange Act”). The Exchange Act claims allege that certain defendants engaged in a fraudulent scheme to artificially inflate the Company’s stock price.
The action is also brought on behalf of all persons or entities who purchased shares of Conagra’s common stock pursuant and/or traceable to the Company’s false and/or misleading registration statement, prospectus and prospectus supplement (the “Offering Documents”) issued in connection with the Company’s secondary public offering commenced on or about October 9, 2018, for the sale of approximately 16.3 million shares of Conagra common stock (the “SPO”), at $35.25 per share, seeking to pursue remedies under the Securities Act of 1933 (the “Securities Act”).
If you are a shareholder who purchased Conagra securities between June 27, 2018, and December 19, 2018, you have until April 23, 2019, to ask the Court to appoint you as Lead Plaintiff for the class. A copy of the Complaint can be obtained at . To discuss this action, contact Robert S. Willoughby at or 888.476.6529 (or 888.4-POMLAW), toll-free, Ext. 9980. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and the number of shares purchased.
Conagra manufactures and markets packaged foods for retail consumers, restaurants and institutions. The Company has a portfolio of well-known food brands including Reddi-wip, Hunt’s, Healthy Choice, Slim Jim and Orville Redenbacher’s. Conagra is based in Chicago, Illinois.
In January 2013, Conagra acquired Ralcorp Holdings, Inc., a manufacturer of private branded food, for $6.8 billion including debt. After trying and failing to address executional shortfalls and customer service issues, Conagra divested its Private Brands business in February 2016 to TreeHouse Foods for $2.7 billion, recognizing a substantial loss.
Less than two years later, Conagra was again acquiring another large publicly traded food service company. On June 27, 2018, Conagra announced the acquisition of Pinnacle in a cash and stock transaction valued at approximately $10.9 billion (the “Transaction”).
At the time of the Transaction and throughout the Class Period, Conagra represented the merger as a combination of two “growing portfolios” and “a no brainer of a deal” that would enhance Conagra’s multi-year transformation plan and expand its presence and capabilities in its most strategic categories, including frozen foods and snacks. Conagra highlighted their due diligence of the deal, the similar cultures and work ethics of the two companies, and the tremendous synergies of the deal. Specifically, Defendants represented that the Company was acquiring “a portfolio of complementary, leading brands” as “the Pinnacle team has done an absolutely phenomenal job driving innovation and growth here, and that meant a lot to us.” In addition, Defendants represented that the Company had a “proven track record of executing strategic transactions” and “will be able to implement a smooth integration process,” as “we’ve been very clear-eyed from the beginning” of the Transaction.
The Complaint alleges that in Conagra’s Offering Documents and throughout the Class Period, Defendants failed to disclose material adverse facts about the Company’s financial well-being, including the troubled acquisition of Pinnacle Foods, Inc. (“Pinnacle”). As a result of Defendants’ wrongful acts, false and misleading statements and omissions, and the precipitous decline in the market value of the Company’s common stock, Plaintiff and other Class members have suffered significant losses and damages.
On or about October 9, 2018, in order to partially finance the pending acquisition of Pinnacle, Defendants effectuated a secondary public offering of 16,312,057 shares of common stock, priced at $35.25 per share. In connection with the SPO, Defendants issued the materially false and/or misleading Offering Documents. The Company received net proceeds of approximately $612 million after underwriters exercised their option of an additional 1,631,206 shares of Conagra common stock.
Unbeknownst to shareholders, however, Conagra and its management were aware or recklessly disregarded that the Transaction would not result in the sort of benefits that Defendants had publicly represented. Just a few weeks after the closing of the merger, on December 20, 2018, Conagra stunned the market by releasing its third quarter 2018 results, as well as an update on the performance of the newly merged company, which revealed that Pinnacle’s performance had been much worse than Defendants had previously represented. In addition, Defendants revealed that Pinnacle’s three leading brands had “suffered sales and distribution losses” in 2018 and accounted “for the vast majority of Pinnacle’s current challenges” due to self-inflicted subpar innovation and executional missteps.
As a result of the disclosure, on December 20, 2018, Conagra’s stock price fell $4.81 per share to $24.28, or nearly 17%, wiping out over $2.3 billion in Conagra’s market capitalization. On the next trading day, Conagra’s stock declined an additional $2.13 per share, or approximately 8.8%. In fact, in three trading sessions, Conagra stock declined $8.13, or nearly 28%, to close at $20.96 on December 24, 2018.
The Pomerantz Firm, with offices in New York, Chicago, Los Angeles, and Paris, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 80 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See
Globe Newswire: 00:00 GMT Friday 15th March 2019
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