NEW YORK, July 2, 2004 (PRIMEZONE) -- Murray, Frank & Sailer LLP announces that a class action lawsuit was filed in the United States District Court for the Western District of Texas on behalf of purchasers of Key Energy Services, Inc. ("Key Energy") (NYSE:KEG) publicly traded securities during the period between April 29, 2003 and June 4, 2004 (the "Class Period").
The complaint charges Key Energy and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Key Energy is the world's largest rig-based, onshore well service company. The Company provides diversified energy operations, including well servicing, contract drilling, pressure pumping, fishing and rental tool services and other oilfield services.
The complaint alleges that during the Class Period, defendants misrepresented the strength of Key Energy's financial results. Throughout the Class Period, defendants repeatedly stated that Key Energy's financials were strong and improving and that it had strengthened its competitive position to benefit once market conditions improved. In fact, the Company's financial statements were materially misstated and not nearly as favorable as reported. As a result of defendants' misstatements, Key Energy's securities traded at artificially inflated levels. Defendants were thus able to complete a $150 million note offering in May 2003 and to exchange 542,477 shares of Key Energy stock in the acquisition of Lea Fishing Tools, Inc. in September 2003.
On March 15, 2004, Key Energy announced it would delay filing its 2003 Form 10-K so that it could review the classification of fixed assets during 2003. Later, on March 29, 2004, Key Energy announced it would be taking write-downs of $83 million to reflect good will impairment and would restate its prior year's financial statements.Then on June 7, 2004, before the market opened, Key Energy announced it was withdrawing earnings guidance for 2004. The Company also disclosed that if it failed to obtain a waiver for its default on its senior notes, it would be in default. On this news, the Company's stock collapsed to as low as $7.00 per share before closing at $8.67 on volume of 13.9 million shares. This was a 37% drop from the Class Period high of $13.96.
Murray, Frank & Sailer LLP and its predecessor firms have devoted its practice to shareholder class actions and complex commercial litigation for more than thirty years and have recovered hundreds of millions of dollars for shareholders in class actions throughout the United States. If you purchased or acquired the common stock of Key Energy between April 29, 2003 and June 4, 2004 inclusive and sustained damages, you may, no later than August 10, 2004, move the Court to serve as lead plaintiff of the class. Shareholders outside the United States may also join the action, regardless of which exchange was used to purchase the securities. To serve as lead plaintiff, however, you must meet certain legal requirements. You can join this class action online at http://www.murrayfrank.com/cases.htm. If you would like to discuss this action, this announcement, or your rights and interests, please contact plaintiff's counsel Eric J. Belfi or Aaron D. Patton of Murray, Frank & Sailer LLP.