An investigation on behalf of investors in Mercury Systems, Inc. (NASDAQ: MRCY) shares over potential wrongdoing at Mercury Systems, Inc. was announced.
San Diego, CA -- (SBWIRE) -- 10/23/2018 -- An investigation was announced for investors in shares of Mercury Systems, Inc. (NASDAQ: MRCY) over potential breaches of fiduciary duties by certain directors at Mercury Systems, Inc.
Investors who purchased shares of Mercury Systems, Inc. (NASDAQ: MRCY) have certain options and should contact the Shareholders Foundation at firstname.lastname@example.org or call +1(858) 779 - 1554.
The investigation by a law firm concerns whether certain Mercury Systems, Inc. (NASDAQ: MRCY officers and directors breached their fiduciary duties and caused damage to the company and its shareholders.
On April 18, 2018, Spruce Point Capital Management ("Spruce Point") published a report asserting that following a "forensic and fundamental analysis" of the Company, Mercury Systems, Inc "appears to be caught in the perfect storm of slowing growth, rising costs and debt." Specifically, the Spruce Point report sees "multiple material adverse changes currently facing Mercury which suggest 50% to 85% downside risk."
On July 10, 2018, a lawsuit was filed against Mercury Systems, Inc over alleged securities laws violations. The plaintiff alleged that the defendants made false and/or misleading statements and/or failed to disclose that Mercury's decision to in-source processing was adversely impacting Mercury's operating margins and free cash-flow generation and conversion, that Mercury's model was becoming structurally more working capital intensive, and that as a result of the foregoing, Mercury's public statements were materially false and misleading at all relevant times.
On October 4, 2018, an article was published reporting that China had infiltrated 30 U.S. companies by inserting a chip into motherboards manufactured by Super Micro Computer, Inc. ("Super Micro").
Then, on October 17, 2018, Spruce Point Management ("Spruce Point") published a report stating that "Spruce Point finds evidence to suggest that Mercury . . . could be one of the companies affected" by the infiltration described in the article from October 4, 2018, and asserted that Spruce Point "can demonstrate recent actions taken by management to obscure the relationship."
Specifically, the Spruce Point report noted that Mercury Systems, Inc and two of its subsidiaries—Themis Computers and Germane Systems—"each sells servers and other related IT equipment containing [Super Micro] motherboards to the Navy and other military branches" and that all three entities "listed [Super Micro] as a 'technology partner' on their respective websites until last week, when nearly all references to the relationship were abruptly and surreptitiously removed between October 8-9 without explanation." Mercury further asserted that "[t]he existence of [Super Micro] motherboards in Mercury's rugged servers presents difficult-to-quantify tail risks, but could force product recalls and expensive supply chain adjustments, among other costly actions."
Those who purchased shares of Mercury Systems, Inc. (NASDAQ: MRCY) have certain options and should contact the Shareholders Foundation.
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