Labaton Sucharow LLP (“Labaton Sucharow”) announces that on March 14, 2019, it filed a securities class action lawsuit, captioned Camelot Event Driven Fund, A Series of Frank Funds Trust v. Alta Mesa Resources, Inc., No. 19-cv-00957 (S.D. Tex.) (the “Action”), on behalf of its client Camelot Event Driven Fund, a Series of Frank Funds Trust (“Camelot Fund”) against Alta Mesa Resources, Inc. f/k/a Silver Run Acquisition Corporation II (NASDAQ: AMR) (“Silver Run II” or the “Company”), Riverstone Investment Group LLC, and certain officers and directors (collectively, “Defendants”).
The Action expands the claims asserted in the action captioned Plumbers & Pipefitters National Pension Fund v. Alta Mesa Resources, Inc., No. 19-cv-00920 (S.D.N.Y.), on behalf of investors who held Silver Run II Class A common stock as of the record date on January 22, 2018 (the “Record Date”) pursuant to Sections 14(a) and 20(a) of the Exchange Act, and the U.S. Securities and Exchange Commission (“SEC”) rule 14a-9 promulgated thereunder, to include claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and SEC Rule 10b-5 promulgated thereunder, on behalf of all persons or entities who purchased or otherwise acquired Silver Run II securities between March 24, 2017 and February 25, 2019, both dates inclusive (the “Class Period”).
Silver Run II was formed in 2016 as a blank check company organized under the laws of Delaware for the purposes of effectuating a merger or acquisition with another firm or business entity. On or about March 24, 2017, Silver Run II carried out an initial public offering, selling 103.5 million shares for gross proceeds of $1.035 billion. In August 2017, Silver Run II announced that it had entered into an agreement, subject to shareholder approval, to merge with two privately held companies, Alta Mesa Holdings, LP (“Alta Mesa”) and Kingfisher Midstream LLC (“Kingfisher”), in a deal initially valued at $3.8 billion (the “Acquisition”).
On January 19, 2018, in order to secure shareholder support for the Acquisition, Silver Run II issued a materially false and misleading merger proxy statement (the “Proxy”). Specifically, the Proxy touted that Alta Mesa and Kingfisher were of “superior quality,” and possessed “[w]orld [c]lass” assets. On February 6, 2018, Silver Run II stockholders voted in favor of the Acquisition, and on February 9, 2018, the Company announced that the deal had closed.
The Action alleges that Defendants’ statements throughout the Class Period, including those in the Proxy, were materially misleading when made. Specifically, the statements omitted and/or misrepresented: (1) that Alta Mesa and Kingfisher did not possess “superior quality” and “[w]orld [c]lass” assets as compared to other operators in the oil and gas industry; (2) that Alta Mesa faced significant operational setbacks; (3) that several major oil producers had steered assets away from production in the region in which Alta Mesa operates; and (4) Kingfisher and Alta Mesa were not on track to achieve the earnings and production estimates provided in the Proxy and Defendants had no reasonable basis to believe and did not believe that Kingfisher and Alta Mesa would achieve these estimates.
The true value of the Acquisition was revealed to investors in a series of disclosures. Specifically, the Company repeatedly missed production and revenue estimates, culminating in the final corrective disclosure on February 25, 2019, when Defendants announced they would be forced to delay the announcement of Silver Run II’s full year 2018 financial results because of ineffective controls over financial reporting. The Company also announced that it expected to record material, non-cash asset impairment charges in the fourth quarter of 2018, totaling $3.1 billion. Over the course of these disclosures, Silver Run II’s stock price has declined over 95% from its Class Period high.
If you purchased or otherwise acquired Silver Run II securities during the Class Period and/or held Silver Run II Class A common stock on the close of business on the Record Date, 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 Southern District of Texas no later than April 1, 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 firstname.lastname@example.org.
You can view a copy of the complaint here.