Jumei International Holding Limited (JMEI) Management-LedGo-Private Proposal is in violations of securities law because of share pricemanipulations.
On Feb 17, JMEI Management (the Party) announced the"going-private" proposal to shareholders to acquire all shares notowned by the Party at 7.00 $ per share. The Management has been intentionallymanipulating the prices of the security in the 3-4 months before theannouncement, mostly likely in collaboration with some internal sellers orshort-sellers, to as low as 4.90 $ in the one week before the go-private offer,and taking advantage of the price collapse to "timely" announce thebuy-back go-private proposal.
Key evidence of price manipulations: 1) The Management(led by Mr. Leo Ou Chen, CHINA) had announced the buy-back of shares of 100millions $ in the open markets last year, but never took actions to buy-backshares in the open markets to support share prices, thus misleading investorsabout the management’s intention to remain to be listed in the US Markets, andintentionally to let the share prices to fall as low as possible so as topropose a low price go-private proposal. 2) The Company has been profitable every quarter sincegoing public, but suddenly announced losses in the last Quarter's earningsreport, resulting in substantial collapse of share prices in the 3 monthsbefore the go-private proposal. The Management did not conduct buy-back shares,or take measures to support share prices. In connection to the recentlyannounced go-private proposal before this Quarter's earning announcement, it isclear that the Management mostly likely has committed accounting frauds tointentionally cause share collapses so as to make a low-ball offer. 3) To be noted, the Management had the company’s shareslisted in the NYSE at 22 $ per share only two years ago, and the listingprospectus indicating great future and the willingness to be listed in the USmarkets long-term. The proposed buy back price is only 32% of the price theysold to the public 2 years ago.
I request the SEC to take actions to prosecute thefraudulent Mr. Leo Ou Chen, CEO of JMEI and his senior Management team, formanipulations of share prices so as to facilitate a low-ball go-private offerat the expenses to all public share holders.