Premier, Inc. Investigation
The law firm of Kirby McInerney LLP is investigating potential claims against Premier, Inc. ("Premier" or the "Company") (NASDAQ: PINC). This investigation concerns whether Premier has violated federal securities laws and/or engaged in other unlawful business practices.
On September 25, 2019, Spruce Point Capital Management, LLC issued a report arguing that "due to a unique pre-IPO restructuring agreement, [Premier] is temporarily generating twice the earnings which its business model can sustain organically." Specifically, in exchange for rights to Premier equity, "member owner" hospitals agreed to five or seven-year contracts with administrative fee rebates at roughly half the rate they could get from competitors. However, "with most member owner equity now having vested, hospitals with expiring contracts are far less incented to remain with Premier at sub-market shareback rates" and are likely to opt out rather than renew their contracts, which "would cause Premier to underperform FY22-23 consensus revenue by >26% and EBITDA by >50%."
On this news, Premier's stock price fell $3.19, or 9.4%, to close at $30.75 on September 25, 2019.
If you acquired Premier 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.