Valaris plc Class Action Lawsuit
- Company Name
- Valaris plc
- Stock Symbol
- Class Period
- April 11, 2019 to July 31, 2019
- Motion Deadline
- October 19, 2019
- Southern District of New York
On August 20, 2019, the Valaris plc class action lawsuit was filed charging Valaris and certain of its officers with violations of the Securities Exchange Act of 1934. The Valaris class action lawsuit was commenced in the United States District Court for the Southern District of New York on behalf of all persons who purchased or otherwise acquired Valaris securities between April 11, 2019 and July 31, 2019 (the “Class Period”) and is captioned Zhang v. Valaris plc, No. 1:19-cv-07816.
Valaris provides offshore drilling services, operating in various water depths worldwide. Valaris has a rig fleet of ultra-deepwater drillships, versatile semisubmersibles, and modern shallow-water jackups. On April 11, 2019, Ensco plc and Rowan Companies plc merger to form Ensco Rowan plc. The merged company was touted as an industry leading offshore driller. On July 2, 2019, Ensco Rowan announced it would change its name to Valaris plc, effective July 31, 2019.
The Valaris class action lawsuit alleges that throughout the Class Period, defendants made materially false and misleading statements and/or failed to disclose material adverse facts about Valaris’s business, operations, and prospects. Specifically, defendants failed to disclose that Valaris was plagued by a weak ultra-deepwater segment, massive cash usage, and significant negative cash flow, which was reasonably likely to have a material negative impact on Valaris’s second quarter 2019 results, and that the merger leading to Valaris’s establishment could not deliver on its touted benefits. As a result of this information being withheld from the market, Valaris securities traded at artificially inflated prices, reaching more than $17 per share during the Class Period.
Then on July 31, 2019, Valaris announced second quarter 2019 financial results – its first earnings report reflecting the results of the combined company – that missed market expectations. On August 2, 2019, Seeking Alpha published an article, entitled “Valaris PLC - Off To A Bad Start,” which noted that Valaris’s results “shock[ed] investors with massive cash usage [and a] . . . surprisingly weak outlook for the ultra-deepwater segment with further dayrate recovery likely delayed until at least the second half of next year.” The Seeking Alpha article further criticized the Company’s free cash flow for the quarter, which was “negative by a whopping $375 million causing the company’s remaining pro forma cash balance adjusted for roughly $741 million in payments related to the recent debt tender offer to decline to just $353 million.” On this news, Valaris’s share price fell $3.25 per share, or approximately 39%, over the two trading days following Valaris’s earnings announcement, to close at $5.02 per share on August 2, 2019.
The Private Securities Litigation Reform Act of 1995 permits any investor who purchased Valaris securities during the Class Period to seek appointment as lead plaintiff in the Valaris class action lawsuit. A lead plaintiff will act on behalf of all other class members in directing the Valaris class action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the Valaris class action lawsuit. An investor’s ability to share in any potential future recovery of the Valaris class action lawsuit is not dependent upon serving as lead plaintiff. If you wish to serve as lead plaintiff of the Valaris class action lawsuit or have questions concerning your rights regarding the Valaris class action lawsuit, please provide your information here or contact counsel, Brian Cochran at 800/449-4900 or 619/231-1058, or via e-mail at firstname.lastname@example.org. Lead plaintiff motions for the Valaris class action lawsuit must be filed with the court no later than October 19, 2019.
Robbins Geller Rudman & Dowd LLP is one of the world’s leading law firms representing investors in securities class action litigation. With 200 lawyers in 9 offices, Robbins Geller has obtained many of the largest securities class action recoveries in history. For six consecutive years, ISS Securities Class Action Services has ranked the Firm in its annual SCAS Top 50 Report as one of the top law firms in the world in both amount recovered for shareholders and total number of class action settlements. Robbins Geller attorneys have helped shape the securities laws and have recovered tens of billions of dollars on behalf of aggrieved victims. Beyond securing financial recoveries for defrauded investors, Robbins Geller also specializes in implementing corporate governance reforms, helping to improve the financial markets for investors worldwide. Robbins Geller attorneys are consistently recognized by courts, professional organizations and the media as leading lawyers in the industry.