LOS ANGELES--(BUSINESS WIRE)--
Glancy Prongay & Murray LLP (“GPM”) announces that it has filed a class action lawsuit in the United States District Court for the Eastern District of New York, captioned Tarapara v. NIO inc. et al., (Case No. 1:19-cv-02777), on behalf of persons and entities that purchased or otherwise acquired Nio Inc. (NYSE: NIO) (“NIO” or the “Company”) securities pursuant and/or traceable to the Company’s false and/or misleading registration statement and prospectus (collectively, the “Registration Statement”) issued in connection with the Company’s September 2018 initial public offering (“IPO” or the “Offering”). Plaintiff pursues claims under Sections 11 and 15 of the Securities Exchange Act of 1934 (the “Exchange Act”).
Investors are hereby notified that they have until May 13, 2019 to move the Court to serve as lead plaintiff in this action.
If you are a shareholder who suffered a loss, click here to participate.
In September 2018, the Company completed its initial public offering (“IPO”), selling 183 million American Depositary Shares (“ADSs” or “shares”) at a price of $6.26 per share. Each ADS represents one share of common stock. The Company received proceeds of approximately $1.15 billion from the IPO, net of underwriting discounts and commissions. The proceeds from the IPO were purportedly to be used for research and development of products; selling and marketing and development of sales channels; development of manufacturing facilities and roll-out of its supply chain; and general corporate purposes and working capital. Notably, approximately $238.7 million was to be used for the development of its Shanghai manufacturing facility.
Then, on March 5, 2019, the Company announced that it would no longer build its own manufacturing plant and would instead rely on state-owned manufacturer, JAC Auto. The Company also reported that electric vehicle deliveries fell due to anticipated subsidy reductions in China in 2019.
On this news, the Company’s share price fell $3.07, or over 30%, over the next two trading days to close at $7.09 per share on March 7, 2019, on unusually heavy trading volume.
On May 9, 2019, the Company’s share price closed at $4.60 per share, which is a decline of $1.66, or approximately 27%, from the IPO price of $6.26.
The complaint filed in this class action alleges that the Registration Statements were false and misleading and omitted to state material adverse facts. Specifically, Defendants failed to disclose to investors: (1) that the Company would not build its own manufacturing plant; (2) that, instead, the Company would rely on JAC Auto, a manufacturer owned by the Chinese government; (3) that reductions in government subsidies for electric cars would materially impact the Company’s sales; (4) that the number of registered users of the Company’s mobile application did not reflect the active user base; and (5) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
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If you purchased NIO securities during the IPO, you have until May 13, 2019 to ask the Court to appoint you as lead plaintiff. To be a member of the Class you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the Class. If you wish to learn more about this action, or if you have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Lesley Portnoy, Esquire, of GPM, 1925 Century Park East, Suite 2100, Los Angeles, California 90067 at 310-201-9150, Toll-Free at 888-773-9224, by email to email@example.com, or visit our website at www.glancylaw.com. If you inquire by email please include your mailing address, telephone number and number of shares purchased.
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