Robbins Geller Rudman & Dowd LLP Files Class Action Suit against Nicholas Financial, Inc.
SAN DIEGO--(BUSINESS WIRE)--Robbins Geller Rudman & Dowd LLP (“Robbins Geller”) today announced that a class action has been commenced in the United States District Court for the Middle District of Florida on behalf of holders of Nicholas Financial, Inc. (“Nicholas Financial”) (NASDAQ:NICK) common stock on December 18, 2013, in connection with the proposed acquisition of Nicholas Financial by Prospect Capital Corporation and certain of its affiliates (“Prospect Capital”).
If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from today. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff’s counsel, Darren Robbins of Robbins Geller at 800/449-4900 or 619/231-1058, or via e-mail at email@example.com. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
The complaint charges Prospect Capital and Nicholas Financial’s Board of Directors (the “Board”) with violations of the Securities Exchange Act of 1934 (“1934 Act”). Nicholas Financial is a Canadian holding company. The business activities of Nicholas Financial are conducted through its two wholly owned subsidiaries, which are engaged in consumer finance and supporting and updating industry-specific computer application software for small businesses.
On December 18, 2013, Nicholas Financial announced that its Board had entered into an Arrangement Agreement with Prospect Capital. The agreement sells Nicholas Financial to Prospect Capital and provides Nicholas Financial's shareholders, for each share of Nicholas Financial stock they own, that number of shares of Prospect Capital stock determined by dividing $16 by the volume-weighted average price of Prospect Capital stock on the NASDAQ exchange for the 20 trading days prior to and ending on the trading day immediately preceding the close of the merger.
The complaint alleges that on January 14, 2014, to encourage Nicholas Financial’s shareholders to accept the merger, defendants filed a Registration Statement on Form N-14 8(c) (“Registration Statement”) with the SEC that contained material misstatements and omissions in violation of §§14(a) and 20(a) of the 1934 Act. According to the complaint, the Registration Statement does not allow Nicholas Financial’s shareholders to properly gauge the expected value they would gain in the merger. Among other things, the complaint alleges that the Registration Statement omits materials details regarding the valuation methodologies Nicholas Financial’s financial advisor, Janney Montgomery Scott LLC, utilized in the fairness opinion it provided to the Board. The complaint concludes that the Registration Statement deprives Nicholas Financial’s shareholders of the ability to cast rational, intelligent and informed votes in favor of or against the merger.
Plaintiff seeks injunctive and equitable relief on behalf of holders of Nicholas Financial common stock as of December 18, 2013. Plaintiff is represented by Robbins Geller, which has outstanding capabilities in prosecuting investor class actions and extensive experience in actions involving financial fraud.
Robbins Geller represents U.S. and international institutional investors in contingency-based securities and corporate litigation. With nearly 200 lawyers in ten offices, the firm represents hundreds of public and multi-employer pension funds with combined assets under management in excess of $2 trillion. The firm has obtained many of the largest recoveries in history and has been ranked number one in the number of shareholder class action recoveries in MSCI’s Top SCAS 50 every year since 2003. Please visit http://www.rgrdlaw.com for more information.