BALA CYNWYD, Pa., Aug. 19, 2002 (PRIMEZONE) -- A pending class action charges Amerada Hess Corp. (NYSE:AHC) ("Amerada Hess" or the "Company") with misleading investors about its business and financial condition according to the law firm of Schiffrin & Barroway, LLP.
The complaint was filed in the U.S. District Court for the District of New Jersey. Plaintiff seeks damages for violations of the federal securities laws on behalf of all investors who purchased Amerada Hess Corp. securities between February 9, 2001 and July 11, 2001 (the "Class Period").
Schiffrin & Barroway, LLP has prosecuted shareholder class actions for over fourteen years and has recovered more than $1 billion for investors. If you are a shareholder of Amerada Hess Corp. and want to learn more about this lawsuit and about becoming a lead plaintiff, you may visit our website at http://www.sbclasslaw.com/cgi/signup.cgi.
The complaint alleges that Amerada Hess Corp., beginning in early 2001, Amerada Hess began secret discussions to acquire Triton Energy Limited ("Triton"), in order to obtain needed additional oil reserves and to significantly boost Amerada Hess' crude oil production. However, it immediately became clear to Amerada Hess' top insiders that due to the demands of Triton's CEO and Triton's controlling shareholder that if Amerada Hess was to acquire Triton, Amerada Hess would have to pay an extremely high price of over $3 billion for Triton, a price in excess of what standard valuation approaches would justify for Triton. Moreover, this price would represent a very substantial premium over Triton's stock trading price and a price that would require Amerada Hess to borrow billions of dollars to finance the purchase of Triton. Without disclosing these discussions and negotiations or Amerada Hess' decision to offer to pay over $3 billion to acquire Triton, the top insiders at Amerada Hess who were involved in, or aware of, the details concerning the proposed acquisition of Triton, sold off huge amounts of their Amerada Hess stock to avoid the losses they knew they would suffer from the sharp decline in Amerada Hess' stock which they knew would occur when the Triton acquisition was disclosed. Consequently, these insiders profited from the artificial inflation in the price of Amerada Hess' stock that persisted while they failed to disclose material information about the proposed Triton acquisition.
By not disclosing that defendants were actively negotiating for the acquisition of Triton, the Individual Defendants violated their duty to "abstain" or "disclose" under the 1934 Act and pursued a scheme to defraud and course of business that operated as a fraud or deceit on purchasers of Amerada Hess stock by selling off over 1.3 million of their Amerada Hess shares at as high as $90 per share for proceeds of $119 million.
On 7/10/01, after the Individual Defendants had completed their stock sales, Amerada Hess disclosed it was acquiring Triton for $3.2 billion ($45 per share), which represented a 50% premium over Triton's 7/9/01 closing price of $29-29/32. Amerada Hess stock fell from $81-11/16 on 7/9/01 to $77 on 7/10/01; to $74 per share on 7/12/01; and to $70-19/32 per share on 7/18/01, a cumulative decline of well over 13% in just seven trading sessions. By 9/26/01, just weeks after Amerada Hess completed the Triton deal and disclosed it had to borrow $2.5 billion to finance the transaction, Amerada Hess' stock fell to $59-3/32 compared to its Class Period high of $90-13/32 in 5/01, a 34% decline.
If you purchased Amerada Hess Corp. securities between February 9, 2001 and July 11, 2001, you may be a member of the class and have until September 24, 2002 to move the court to become a lead plaintiff. In order to serve as lead plaintiff, however, you must meet certain legal requirements. To be a member of the class, however, you do not need to take any action at this time. Should you decide to seek appointment as a lead plaintiff, you may retain Schiffrin & Barroway, or retain counsel of your choice.
To learn more about your rights and interests in this case and your ability to potentially recoup your losses, please contact Schiffrin & Barroway (Marc A. Topaz, Esq. or Stuart L. Berman, Esq.) directly at 888-299-7706 (toll free) or 610-822-2221, fax number 610-822-0002, e-mail at info@sbclasslaw.com or visit our website at www.sbclasslaw.com.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca