Labaton Sucharow LLP Files Securities Class Action Lawsuit Against Conagra Brands, Inc.
April 15 2019 - 7:46PM
Business Wire
Labaton Sucharow LLP (“Labaton Sucharow”) announces that on
April 15, 2019 it filed a securities class action lawsuit,
captioned Houston Municipal Employees Pension System v.
Conagra Brands, Inc. No. 19-cv-02550 (N.D. Ill.) (the “Action”), on
behalf of its client Houston Municipal Employees Pension System
(“Houston Municipal”) against Conagra Brands, Inc. (NYSE: CAG)
(“Conagra” or the “Company”), and certain officers and directors
(collectively, “Defendants”).
The Action, which asserts claims under Sections 10(b) and 20(a)
of the Securities Exchange Act of 1934 (the “Exchange Act”), and
SEC Rule 10b-5 promulgated thereunder, expands the class definition
for Exchange Act claims asserted in the previously filed action
captioned West Palm Beach Firefighters’ Pension Fund v. Conagra
Brands, Inc., No. 19-cv-01323 (N.D. Ill.), brought on behalf of all
persons or entities who purchased or otherwise acquired Conagra
common stock from June 27, 2018 through December 19, 2018,
inclusive (the “Class Period”), to specifically include legacy
Pinnacle Foods, Inc. (“Pinnacle”) common stock holders who received
Conagra common stock in exchange for their Pinnacle shares on
October 26, 2018 upon completion of the Company’s acquisition of
Pinnacle (the “Class Period”).
Conagra, based in Chicago, Illinois, manufactures and markets
packaged foods for retail consumers, restaurants and institutions.
The Company has a portfolio of well-known food brands including
Reddi-wip, Hunt’s, Healthy Choice, Slim Jim and Orville
Redenbacher’s.
On June 27, 2018, Conagra announced the acquisition of Pinnacle,
in a cash and stock transaction valued at approximately $10.9
billion (the “Transaction”). Pursuant to the terms of the
Transaction, Conagra was to pay approximately $5.1 billion in cash
and issue approximately 77.45 million Company shares out of the
Company’s treasury to former holders of Pinnacle common stock. Upon
closing of the Transaction on October 26, 2018, Pinnacle common
stock holders received $43.11 in cash and 0.6494 shares of Conagra
common stock in exchange for each share of Pinnacle held. The
implied consideration price for each share of Pinnacle was valued
at $68.00 per share.
At the time of the Transaction and throughout the Class Period,
Conagra represented the merger as a combination of two “growing
portfolios” that would enhance Conagra’s multi-year transformation
plan and expand its presence and capabilities in its most strategic
categories, including frozen foods and snacks. Conagra highlighted
their due diligence of the deal, the similar cultures and work
ethics of the two companies, and the tremendous synergies of the
deal.
Unbeknownst to shareholders, however, Conagra and its management
were aware or recklessly disregarded that the Transaction would not
result in anywhere near the sort of benefits that Defendants had
publicly represented. Just a few weeks after the closing of the
merger, on December 20, 2018, Conagra stunned the market by
releasing its third quarter 2018 results, as well as an update on
the performance of the newly merged company, which revealed that
Pinnacle’s performance had been much worse than Defendants had
previously represented. In addition, Defendants revealed that
Pinnacle’s three leading brands had “suffered sales and
distribution losses” in 2018, and accounted “for the vast majority
of Pinnacle’s current challenges” due to self-inflicted subpar
innovation and executional missteps.
As a result of the disclosure, on December 20, 2018, Conagra’s
stock price fell $4.81 per share to $24.28, or nearly 17%, wiping
out over $2.3 billion in Conagra’s market capitalization,
continuing to fall precipitously over the following two trading
days for a total decline of approximately 30%.
If you purchased or otherwise acquired Conagra common stock
during the Class Period and were damaged thereby, you are a member
of the “Class” and may be able to seek appointment as Lead
Plaintiff. Lead Plaintiff motion papers must be filed with the U.S.
District Court for the Northern District of Illinois no later than
April 23, 2019. The Lead Plaintiff is a court-appointed
representative for absent members of the Class. You do not need to
seek appointment as Lead Plaintiff to share in any Class recovery
in the Action. If you are a Class member and there is a recovery
for the Class, you can share in that recovery as an absent Class
member. You may retain counsel of your choice to represent you in
the Action.
If you would like to consider serving as Lead Plaintiff or have
any questions about this lawsuit, you may contact Francis P.
McConville, Esq. of Labaton Sucharow, at (800) 321-0476, or via
email at fmcconville@labaton.com.
Houston Municipal is represented by Labaton Sucharow, which
represents many of the largest pension funds in the United States
and internationally with combined assets under management of more
than $2 trillion. Labaton Sucharow has been recognized for its
excellence by the courts and peers, and it is consistently ranked
in leading industry publications. Offices are located in New York,
NY, Wilmington, DE, and Washington, D.C. More information about
Labaton Sucharow is available at www.labaton.com.
You can view a copy of the complaint here.
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version on businesswire.com: https://www.businesswire.com/news/home/20190415005912/en/
Francis P. McConville, Esq.Labaton Sucharow(800)
321-0476fmcconville@labaton.com.
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