NEW YORK, Sept. 26, 2016 /PRNewswire/ -- Attorney
Advertising -- Bronstein, Gewirtz & Grossman, LLC notifies
investors that a class action lawsuit has been filed against MGT
Capital Investments, Inc. ("MGT" or the "Company) (NYSE: MGT) and
certain of its officers. The class action is on behalf of a
class consisting of all persons or entities who purchased MGT
securities between May 9, 2016 and
September 20, 2016, inclusive (the
"Class Period").
This class action seeks to recover damages against Defendants
for alleged violations of the federal securities laws under the
Securities Exchange Act of 1934 (the "Exchange Act").
MGT acquires, advances, and monetizes assets in the online,
mobile, and casino gaming space. The Company operates through two
segments, Gaming and Intellectual Property. The Company is
currently in the process of acquiring D-Vasive, a provider of
leading edge anti-spy software, and Demonsaw, a provider of a
secure and anonymous file sharing software platform.
On May 9, 2016, MGT announced that
it had entered into an agreement to acquire certain assets and
technologies from D-Vasive Inc. ("D-Vasive"), a provider of
anti-spy software (the "D-Vasive Transaction"). With this
acquisition, MGT announced the planned position of Defendant
John McAfee ("McAfee") as MGT's
Executive Chairman and Chief Executive Officer ("CEO"), and the
planned corporate name change to John McAfee Global Technologies,
Inc. MGT notified investors that "[m]ajor terms of the deal
include the payment to D-Vasive Inc. stockholders of 23.8 million
restricted shares of MGT stock and $300,000 in cash. The proposed share
issuance is expected to amount to roughly 47% of the Company on a
pro-forma diluted basis at closing."
Then, on May 26, 2016, the Company
publicized that it had entered into an agreement to acquire certain
technology and assets from Demonsaw LLC ("Demonsaw"), which MGT
said is "a provider of a secure and anonymous file sharing software
platform." MGT notified investors that "[m]ajor terms of the
deal include the payment to Demonsaw LLC members of 20.0 million
restricted shares of MGT common stock. The proposed share
issuance is expected to amount to approximately 28% of the
Company's common stock on a pro-forma fully diluted basis at
closing, inclusive of shares of common stock to be issued in
connection with the Company's previously announced transaction with
D-Vasive, Inc." MGT and D-Vasive would then arrange for
D-Vasive to purchase Demonsaw in advance of the D-Vasive
Transaction, "in order to simplify these transactions, and meet
certain customary tax issues," so that MGT would acquire Demonsaw's
assets as well as D-Vasive's via the D-Vasive Transaction.
On September 9, 2016, at
MGT's 2016 Annual Meeting of Stockholders, the Company stated
its the issuance of a total of 43.8 million shares of common stock
in connection with the D-Vasive Transaction had been approved by
its shareholders.
The Complaint alleges that throughout the Class Period,
Defendants made false and/or misleading statements and/or failed to
disclose: (1) the NYSE was unlikely to approve the listing of the
43.8 million additional shares that MGT was required to issue in
connection with the acquisitions of D-Vasive and Demonsaw; and (2)
consequently, MGT's public statements were materially false and
misleading at all relevant times.
On September 19, 2016, pre-market,
MGT announced that on September 15,
2016, it received a subpoena from the Securities and
Exchange Commission ("SEC"). The Company stated that it does not
believe it will be the subject of any enforcement proceedings and
is fully cooperating with the SEC's requests. Following this news,
MGT stock dropped $0.74 per share, or
22.7%, to close at $2.52 on
September 19, 2016.
Then on September 20, 2016, MGT
announced that the NYSE had informed MGT on September 19, 2016 that it would "not approve the
listing on the Exchange of the 43.8 million shares that the Company
is required to issue in order to complete the closing of the
D-Vasive [sic] merger," and that "[t]he Company and John McAfee remain committed to closing the
transaction and are exploring alternatives."
Then on September 20, 2016, MGT
announced that the NYSE would not approve the listing of 43.8
million shares.
A class action lawsuit has already been filed. If you wish to
review a copy of the Complaint you can visit the firm's site:
http://www.bgandg.com/mgt or you may contact Peretz Bronstein, Esq. or his Investor Relations
Analyst, Yael Hurwitz of Bronstein,
Gewirtz & Grossman, LLC at 212-697-6484 or via email
info@bgandg.com. Those who inquire by e-mail are encouraged to
include their mailing address and telephone number. If you
suffered a loss in MGT you have until November 21, 2016 to request that the Court
appoint you as lead plaintiff. Your ability to share in any
recovery doesn't require that you serve as a lead plaintiff.
Bronstein, Gewirtz & Grossman, LLC is a corporate litigation
boutique. Our primary expertise is the aggressive pursuit of
litigation claims on behalf of our clients. In addition to
representing institutions and other investor plaintiffs in class
action security litigation, the firm's expertise includes general
corporate and commercial litigation, as well as securities
arbitration. Attorney advertising. Prior results do not
guarantee similar outcomes.
Contact:
Bronstein, Gewirtz & Grossman, LLC
Peretz Bronstein or Yael Hurwitz
212-697-6484 | info@bgandg.com
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SOURCE Bronstein, Gewirtz & Grossman, LLC