Phoenix Tree Holdings Limited
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 New York on behalf of those who acquired Phoenix Tree Holdings Limited (“Phoenix” or the “Company”) (NYSE: DNK) securities pursuant and/or traceable to the Company’s January 22, 2020 initial public offering (“IPO”). Investors have until June 23, 2020 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
On January 22, 2020, the Company completed its IPO, selling 9.6 million ADSs, representing 96 million Class A ordinary shares, at $13.50 per share for total net proceeds of $128.4 million.
The lawsuit alleges that the Offering Materials failed to disclose that: (i) Phoenix had received customer complaints and negative press regarding questionable business conduct before the IPO, including its widespread and notorious practice of deceptively inducing renters to procure loans whose proceeds financed the Company’s business and operations; (ii) competition in the residential rental market in China had suffered at the time of the IPO as the coronavirus ravaged the very locations where Phoenix primarily operated, including Wuhan, the epicenter of the pandemic; (iii) Phoenix’s technological capabilities were unable to enable the Company to overcome the complications and erosion of business resulting from the spread of the coronavirus throughout China at the time of the IPO; (iv) Phoenix was contending with extraordinarily adverse developments in China at the time of the IPO due to the coronavirus that presented events, risks and uncertainties that were reasonably likely to materially affect Phoenix’s business, operations and financial condition, including a material increase in renter complaints and negative press and the prospect that renters could not continue to pay rent and service fees under conditions then existing as of the IPO; and (v) as a result of the foregoing, Phoenix was positioned no differently than its competitors in managing the fallout from customer complaints or adverse implications stemming from the coronavirus in China.
At the time the lawsuit was filed, Phoenix ADSs were trading at $6.97 per share.
If you acquired Phoenix securities, have information, or would like to learn more about these claims, please contact Thomas W. Elrod of Kirby McInerney LLP at 212-371-6600, by email at firstname.lastname@example.org, or by filling out this contact form, to discuss your rights or interests with respect to these matters without any cost to you.