SAN DIEGO & CHARLOTTE, N.C.--(BUSINESS WIRE)--Shareholder rights law firm Robbins Arroyo LLP announces that investors filed a class action complaint against Capitala Finance Corp. (NasdaqGS: CPTA) ("Capitala") on behalf of all purchasers of Capitala Finance securities between January 4, 2016 and August 7, 2017, for alleged violations of the Securities Exchange Act of 1934 by Capitala's officers and directors. Capitala Finance is a management investment company.
View this information on the law firm's Shareholder Rights Blog: www.robbinsarroyo.com/capitala-finance-corporation
Capitala Accused of Misleading Investors About the Quality of its Investment Portfolio
According to the complaint, Capitala Investment Advisors, LLC manages Capitala Finance in exchange for an annual base management fee and an incentive fee. On January 4, 2016, Capitala Finance announced that Capitala Investment Advisors agreed to voluntarily waive its quarterly incentive fee. Throughout the class period, Capitala Finance emphasized in its Securities and Exchange Commission filings that the company's success "depends on the ability of Capitala Investment Advisors to attract and retain qualified personnel in a competitive environment." On August 7, 2017, Capitala Finance revealed that six of its investments were on non-accrual status—twice as many as it had the previous quarter. The next day, Capitala Finance revealed that Capitala Investment Advisors had been losing professional talent in underwriting and portfolio management due to the waiving of its incentive fee. Capitala Finance further acknowledged that the rising number of nonaccrual investments was connected to the loss in talent, causing the company’s stock to fall nearly 30% over the next three trading days to close at $8.99 per share on August 10, 2017. Capitala Finance's stock has since fallen even further, closing at $7.28 per share on December 29, 2017.
Capitala Shareholders Have Legal Options
If you would like more information about your rights and potential remedies contact attorney Leonid Kandinov at (800) 350-6003, LKandinov@robbinsarroyo.com, or via the shareholder information form on the firm's website.
Robbins Arroyo LLP, a nationally recognized leader in shareholder rights law, represents individual and institutional investors in shareholder derivative and securities class action lawsuits, and has helped its clients realize more than $1 billion of value for themselves and the companies in which they have invested.
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