| Company: | Virgin Mobile USA, Inc. |
| Ticker Symbol: | NYSE: VM |
| Initial Public Offering: | October 11, 2007 |
| Date Filed: | Nov-22-07 |
| Lead Plaintiff Deadline: | Jan-22-08 |
| Court: | District, NJ |
| Allegations: |
A class action lawsuit has been filed against Virgin Mobile USA, Inc. ("VM USA" or the "Company") (NYSE:VM) in the United States District Court for the District of New Jersey, on behalf of shareholders who purchased the common stock of VM USA in connection with the Company's IPO on or about October 11, 2007, or who purchased shares thereafter in the open market. No class has yet been certified in this action.
VM USA, certain of its officers and directors, certain controlling majority shareholders, and the Company's underwriters are charged with including, or allowing the inclusion of, materially false and misleading statements in the Registration Statement and Prospectus issued in connection with the IPO, in violation of the Securities Act of 1933.
The Complaint charges that VM USA raised over $412.5 million through the issuance of 27.5 million shares, despite the Registration Statement's false and misleading statements. Specifically, defendants each failed to conduct an adequate due diligence investigation into the Company prior to the IPO, and they also each failed to reveal, at the time of the IPO, that Virgin Mobile was also not performing according to plan and that results for the third quarter of 2007 -- the period ended a full 2 weeks prior to the VM USA IPO -- showed growing losses as expenses rose and business slowed, indicating that the Company would be forced to revise downward its near-term forward financial and operational guidance.
On November 16, 2007, approximately one month after the IPO, investors learned the truth about VM USA's financial and operational condition, after defendants revealed that the Company had suffered a widening loss for the third quarter, the period ended September 30, 2007, as a result of rising expenses -- a loss of $7.3 million, or ($0.15) per share, compared with a loss of only $5.1 million, or ($0.10) per share, in the same period the prior year. These results also contrasted the $28.9 million in net income, and profits of $0.55 per share reported in the first six months of 2007, reported prior to the IPO. Further, Defendants also revealed that fourth-quarter 2007 outlook called for between 350,000 and 400,000 net customer additions, an anemic amount analysts described as "weak," and that 4Q:07 guidance would be what was described as "well below" expectations.
On this news, shares of VM USA fell nearly 30% in intra-day trading, from an opening trading price of $11.09 per share to a trading low of $8.07 per share before closing the trading day at $9.10 per share, on exceedingly high volume of 6.512 million shares.
If you acquired the securities of the defendants during the Class Period you may, no later than the Lead Plaintiff Deadline shown above, request that the Court appoint you as lead plaintiff through counsel of your choice. You may also choose to remain an absent class member. A lead plaintiff must meet certain requirements.
VM USA, certain of its officers and directors, certain controlling majority shareholders, and the Company's underwriters are charged with including, or allowing the inclusion of, materially false and misleading statements in the Registration Statement and Prospectus issued in connection with the IPO, in violation of the Securities Act of 1933.
The Complaint charges that VM USA raised over $412.5 million through the issuance of 27.5 million shares, despite the Registration Statement's false and misleading statements. Specifically, defendants each failed to conduct an adequate due diligence investigation into the Company prior to the IPO, and they also each failed to reveal, at the time of the IPO, that Virgin Mobile was also not performing according to plan and that results for the third quarter of 2007 -- the period ended a full 2 weeks prior to the VM USA IPO -- showed growing losses as expenses rose and business slowed, indicating that the Company would be forced to revise downward its near-term forward financial and operational guidance.
On November 16, 2007, approximately one month after the IPO, investors learned the truth about VM USA's financial and operational condition, after defendants revealed that the Company had suffered a widening loss for the third quarter, the period ended September 30, 2007, as a result of rising expenses -- a loss of $7.3 million, or ($0.15) per share, compared with a loss of only $5.1 million, or ($0.10) per share, in the same period the prior year. These results also contrasted the $28.9 million in net income, and profits of $0.55 per share reported in the first six months of 2007, reported prior to the IPO. Further, Defendants also revealed that fourth-quarter 2007 outlook called for between 350,000 and 400,000 net customer additions, an anemic amount analysts described as "weak," and that 4Q:07 guidance would be what was described as "well below" expectations.
On this news, shares of VM USA fell nearly 30% in intra-day trading, from an opening trading price of $11.09 per share to a trading low of $8.07 per share before closing the trading day at $9.10 per share, on exceedingly high volume of 6.512 million shares.
If you acquired the securities of the defendants during the Class Period you may, no later than the Lead Plaintiff Deadline shown above, request that the Court appoint you as lead plaintiff through counsel of your choice. You may also choose to remain an absent class member. A lead plaintiff must meet certain requirements.
