Velti Plc Sued by Investor
Robbins LLP announce that an investor of Velti Plc (NASDAQ: VELT) (“Velti”) has filed a complaint in the U.S. District Court for the Northern District of California. The complaint alleges that the company and certain of its officers and directors violated the Securities Exchange Act of 1934 between January 27, 2011 and August 20, 2013 (the “Class Period”). Velti provides mobile marketing and advertising technology and solutions for brands, advertising agencies, mobile operators, and media companies primarily in Europe, the Americas, Asia, and Africa.
Velti Accused of Making False and Misleading Statements
According to the complaint, Velti made false and/or misleading statements regarding the company’s business operations and prospects. Specifically, the complaint alleges that the Velti and certain officers and directors failed to disclose difficulties experienced by the company collecting certain receivables. Further, the company failed to disclose that certain of its receivables were uncollectible and responsible for overstatements to Velti’s receivables during the Class Period. As a result of these false and misleading statements and omissions, Velti’s shares traded at artificially inflated prices during the Class Period.
Velti Stock Price Drops on News of Restructuring and Write-Down of Receivables
According to the complaint, on August 20, 2013, Velti announced that the company was evaluating the collectability of receivables on the books of its Greek and Cypriot subsidiaries. As a result, the company was forced to take a charge of approximately $111 million to its trade and accrued contract receivables relating to its enterprise business. In addition, the company also announced that it would undertake a major restructuring of its business. On this news, Velti stock price declined nearly 66%, or $0.66, to close at $0.34 per share on August 21, 2013.
If you invested in Velti and would like to discuss your shareholder rights, please contact attorney Darnell R. Donahue at (800) 350-6003 or you can complete the form below and we will contact you directly.