PR Newswire
NEW YORK, Dec. 28, 2023
NEW YORK, Dec. 28, 2023 /PRNewswire/ -- Pomerantz LLP is investigating claims on behalf of investors of VNET Group, Inc. ("VNET" or the "Company") (NASDAQ: VNET). Such investors are advised to contact Danielle Peyton at [email protected] or 646-581-9980, ext. 7980.
The investigation concerns whether VNET and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices.
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As of February 28, 2022, VNET's co-founder, Josh Sheng Chen, beneficially owned approximately 78.52 million VNET shares individually and through his sole ownership of certain companies, including GenTao Capital Limited ("GenTao") and Sunrise Corporate Holding Ltd. ("Sunrise").
On August 19, 2021, he and his companies entered into a $50.25 million margin loan facility with Bold Ally (Cayman) Limited ("Bold Ally"), pledging all of his shares of GenTao, Sunrise, and Beacon Capital Group Inc. as collateral, thus effectively pledging a significant percentage of his VNET shares as collateral (the "Facility Agreement").
On February 13, 2023, Bold Ally announced it would exercise its rights under the Facility Agreement following a default by GenTao and was entitled to 48,515,634 Class A ordinary shares (in the form of 8,085,939 American depositary shares, or "ADSs" or "shares") and 27,757,992 Class B ordinary shares of the Company. On this news, VNET's share price fell $0.20 per share, or 3.2% to close at $6.11 per share on February 13, 2023, on unusually heavy trading volume. The Company's share price continued to decline by $1.09 per share, or 17.8%, over the next consecutive trading session to close at $5.02 per share on February 14, 2023, on unusually heavy trading volume.
Then, on February 15, 2023, VNET disclosed that its Board of Directors (the "Board") had approved and authorized the issuance of up to 555,000 newly created Class D ordinary shares to the Executive Chairman of the Board, and that these shares would be granted a 500-to-1 vote per share power. The Company stated this measure was required in order to "protect the Company's interests and continued stability."
On this news, VNET's share price fell $0.10 per share, or 2%, to close at $4.92 per share on February 15, 2023, on unusually heavy trading volume.
Pomerantz LLP, with offices in New York, Chicago, Los Angeles, London, Paris, and Tel Aviv, 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, Pomerantz pioneered the field of securities class actions. Today, more than 85 years later, Pomerantz 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 billions of dollars in damages awards on behalf of class members. See www.pomlaw.com.
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CONTACT:
Danielle Peyton
Pomerantz LLP
[email protected]
646-581-9980 ext. 7980
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SOURCE Pomerantz LLP
