SAN DIEGO, Feb. 21, 2023 (GLOBE NEWSWIRE) --
The Class: Robbins LLP reminds investors that a shareholder filed a class action on behalf of all persons and entities that purchased or otherwise acquired Argo Blockchain (NASDAQ: ARBK) American Depository Shares ("ADSs") pursuant to the Company’s initial public offering ("IPO") conducted on September 23, 2021, or between September 23, 2021 and October 10, 2022. The complaint alleges violations under the Securities Act of 1933 and Securities Exchange Act of 1934. Argo, together with its subsidiaries, purports to engage in the cryptocurrency mining business worldwide, including the mining of Bitcoin or Bitcoin equivalents (together, “BTC”).
What Now: Similarly situated shareholders may be eligible to participate in the class action against Argo Blockchain. Shareholders who want to be appointed lead plaintiff for the class must file their papers by March 27, 2023. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. You do not have to participate in the case to be eligible for a recovery. For more information, click here.
All representation is on a contingency fee basis. Shareholders pay no fees or expenses.
What is this Case About: Argo Blockchain plc (ARBK) Failed to Disclose Material Relevant Information in Connection with its Registration Statement in Support of its IPO
According to the complaint, Argo conducted its IPO on September 23, 2021, issuing 7.5 million ADSs at the offering price of $15 per ADS for approximate proceeds of $105 million. Defendants and the Offering Documents in connection with the IPO failed to disclose that: (i) Argo was highly susceptible to and/or suffered from significant capital constraints, electricity and other costs, and network difficulties; (ii) these issues hampered, inter alia, Argo’s ability to mine BTC, execute its business strategy, meet its obligations, and operate its Helios facility; and (iii) as a result, Argo’s business was less sustainable than defendants had led investors to believe.
On June 7, 2022, Argo provided an operation update and disclosed it had mined approximately 25% fewer BTC in May 2022 compared to April 2022 because of, inter alia, increased network difficulty, higher electricity prices, and the curtailment of mining operations at its Helios facility. On this news, Argo’s ADS price fell $0.28 per ADS, or 4.4%, to close at $6.09 per ADS on June 7, 2022.
On October 7, 2022, Argo issued a press release "announc[ing] several strategic actions that are intended to bring in additional capital to the business and ensure that the Company has the working capital necessary to execute its current strategy and meet its obligations over the next twelve months.” Argo stated that in addition to measures being undertaken to reduce costs and preserve capital, the Company had signed a non-binding letter of intent with an affiliate of New York Digital Investment Group to amend an existing equipment financing agreement, plans to sell 3,400 mining machines for cash proceeds of £6 million, and intends to raise approximately £24 million via a proposed subscription with a strategic investor. On this news, Argo’s ADS price fell $0.97 per ADS, or 23.26%, to close at $3.20 per ADS on October 7, 2022.
Then, on October 11, 2022, Argo provided an operational update, announcing that “[d]uring the month of September, Argo mined 215 [BTC] compared to 235 BTC in August 2022” which was “primarily due to a 12% increase in average network difficulty during September.” Argo also stated that it “is continuing to curtail operations at its Helios facility in Dickens County, Texas during periods of high electricity prices” and was replacing the Company’s Chief Technology Officer (“CTO”). On this news, Argo’s ADS price fell $0.27 per ADS, or 10.98%, to close at $2.19 per ADS on October 11, 2022. Argo's ADSs now traded under $2 per ADS, significantly below the Company's IPO price.
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