SAN DIEGO & NEW YORK--(BUSINESS WIRE)--Shareholder rights law firm Robbins Arroyo LLP announces that purchasers of Synergy Pharmaceuticals Inc. (NasdaqGS: SGYP) have filed a class action complaint against the company's officers and directors for alleged violations of the Securities Exchange Act of 1934 between September 5, 2017 and November 14, 2017. Synergy, a biopharmaceutical company, develops and commercializes novel therapies to treat gastrointestinal diseases and disorders
View this information on the law firm's Shareholder Rights Blog:
Synergy Accused of Taking Out Large Loan at Shareholders' Expense
According to the complaint, on September 5, 2017, Synergy announced that it closed on a $300 million senior secured loan from CRG Partners III L.P. Synergy said the loan was non-dilutive and would give the company the ability to launch its drug, Trulance, and achieve its business objectives, which it was confident would maximize long-term shareholder value and fund the company's plans through 2019. Consequently, investors were under the impression that Synergy would successfully develop and profit from Trulance without needing to raise additional capital or dilute stockholders' outstanding equity interests. The CRG loan, however, had critical undisclosed terms and conditions that prevented Synergy from accessing funds "when needed." As a result, in order to fund its operations, on November 14, 2017, Synergy conducted a secondary offering of approximately 22 million shares for net proceeds of $52.4 million. The 10% dilutive capital increase was described by investors as "unexpected," "blindsiding," and stoked "fears about further unexpected dilution."
Synergy 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 is a nationally recognized leader in shareholder rights law. The firm 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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