Camber Energy, Inc.
The law firm of Kirby McInerney LLP announces that a class action lawsuit has been filed in the U.S. District Court for the Southern District of Texas on behalf of those who acquired Camber Energy, Inc. (“Camber” or the “Company”) (NYSE: CEI) securities from February 18, 2021 through October 4, 2021, inclusive (the “Class Period”). Investors have until December 28, 2021 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
Camber is an independent oil and natural gas company that acquires, develops, and sells crude oil, natural gas, and natural gas liquids.
In December 2020, Camber acquired a controlling interest in Viking Energy Group, Inc. (“Viking”), a purported independent exploration and production company. Then, in February 2021, Camber executed a definitive merger agreement with Viking to effect the full combination of the two entities (the “Merger”).
On May 24, 2021, Viking filed a quarterly report on Form 10-Q with the Securities and Exchange Commission (“SEC”), reporting the Company’s financial and operating results for the quarter ended March 31, 2021. That quarterly report disclosed, among other results, first-quarter earnings per share (“EPS”) of -$0.13 under generally accepted accounting principles (“GAAP”), compared to GAAP EPS of $1.39 in the same quarter the year prior, representing a 109.35% decrease year-over-year (“Y/Y”), and first-quarter revenue of $10.49 million, compared to revenue of $11.79 million in the same quarter the year prior, representing an 11% decrease Y/Y.
Later that day, Camber issued a press release disclosing that, on May 21, 2021, the NYSE had notified the Company that it was not in compliance with the NYSE’s continued listing standards because of, inter alia, “issues that have arisen in connection with (i) finalizing the determination of the fair values of both assets and liabilities associated with the Company’s acquisition of a controlling interest in Viking . . . in December of 2020[.]” On this news, the Company’s share price declined by $0.02 per share, or approximately 3.17%, from $0.63 per share to close at $0.61 per share on May 24, 2021.
Then, on August 16, 2021, Viking filed a quarterly report on Form 10-Q with the SEC, reporting its financial and operating results for the quarter ended June 30, 2021. That quarterly report disclosed, among other results, a net loss of $9.85 million for the quarter, and that, “[a]s of June 30, 2021, [Viking] has a stockholders’ deficit of $15,054,324 and total long-term debt of $95,961,611.” On this news, the Company’s share price declined by $0.03 per share, or approximately 7%, from $0.43 per share to close at $0.40 per share on August 16, 2021.
Finally, on October 5, 2021, Kerrisdale Capital released a report alleging, among other issues revealed in earlier disclosures, that the “market is badly mistaken about Camber’s share count and ignorant of [Camber’s] terrifying capital structure,” estimating the Company’s “fully diluted share count is roughly triple the widely reported number[.]” On this news, the Company’s share price declined by $1.56 per share, or approximately 50.49%, from $3.09 per share to close at $1.53 per share on October 5, 2021.
The lawsuit alleges throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Camber overstated the financial and business prospects of Viking as well as the combined Company post-Merger; (ii) Camber failed to apprise investors of, and/or downplayed, the fact that its acquisition of a controlling interest in Viking would exacerbate the Company’s delinquent financial statements and listing obligations with the NYSE; (iii) an institutional investor was diluting Camber’s shares at a significant rate following the Company’s July 12, 2021 update regarding the number of its shares of common stock issued and outstanding; and (iv) as a result, the Company’s public statements were materially false and misleading at all relevant times.