EARLY SECONDARY EDUCATION GR – GuruFocus.com
THE PRINCIPAL APPLICANT DEADLINE IS JULY 11, 2022
NEW YORK, May 26, 2022 /PRNewswire/ — Wolf Haldenstein Adler Freeman & Herz LLP announces that a federal securities class action lawsuit has been filed in United States District Court for the Southern District of New York v First High-School Education Group Co., Ltd. (NYSE: FHS) American Depositary Shares (“ADSs”) on behalf of all investors who purchased shares in or traceable to First High-School Education March 2021 initial public offering (the “IPO”).
All investors who purchased the shares of First High-School Education Group Co., Ltd. and losses incurred are advised contact the company immediately at [email protected] or (800) 575-0735 or (212) 545-4774. You can get additional information about the action or join the case on our website, www.whafh.com.
If you have suffered losses in First High School Education Group Co.,Ltd., you can, at the latest July 11, 2022, ask the Court to name you as the lead plaintiff in the proposed class. please contact Wolf Haldenstein to find out more about your rights as an investor in First High School Education Group Co., Ltd.
PLEASE CLICK HERE TO JOIN THE CASE
The filed complaint alleges that the IPO’s registration statement misrepresented because the defendants failed to disclose the following adverse facts that existed at the time of the IPO:
- that the new rules, regulations and policies to be implemented by the Chinese government following the parliamentary meetings of the two sessions were much more severe than what was presented to investors and posed a significant adverse threat to First High-School Education and its activities ;
- that China’s regulations and rules regarding private education were causing slower government approval for the opening of new educational institutions, which would have a negative effect on First High-School Education’s enrollment and growth; and
- that, therefore, statements in the listing statement regarding First High-School Education’s historical financial and operating measures and alleged market opportunities did not accurately reflect the actual business, operations and financial results and trajectory of First High-School Education at the time of the IPO, and were materially false and misleading and lacked a factual basis.
On May 12, 2021news reports have revealed that the impending government crackdown on for-profit education companies in China would be much more drastic and far-reaching than previously thought.
Subsequently, on May 14, 2021, Chinese authorities have announced rules that would further tighten the regulation of compulsory education and training institutions. According to an article on fitchratings.com title “Legal changes in private education in China: Growing Risks for K-12 Education Companies; Benefits for Higher Education Providers,” the new rules “aim to prohibit profit-making in compulsory education” and “exposes K-12 school operators to increased regulatory risk and their revenue growth may be weak…until that they get more clarity on how the changes will be implemented.”
On July 23, 2021, China unveiled a sweeping overhaul of its education sector, barring companies that teach the school curriculum from making a profit, raising capital or going public. These drastic measures effectively ended any potential growth of the for-profit tutoring industry by China.
Two months later, the September 28, 2021First High-School Education revealed that its revenue for the first half of 2021 was 231.9 million RMBa year-over-year increase of just 24.8%, a sharp drop from the 30.5% year-over-year revenue increase for the first nine months of 2020 and the revenue increase of 32.5% year over year for the full year 2020.
The following month, the October 13, 2021First High-School Education issued a statement announcing that its chief financial officer, defendant Lidong Zhu, had resigned from his position as chief financial officer. And on December 16, 2021First High-School Education has announced that it has terminated its KPMG auditor Huazhen LLP.
On April 5, 2022, First High-School Education announced that it had received a letter from the New York Stock Exchange (“NYSE”) stating that it does not meet NYSE listing requirements because its total market capitalization and equity clean had fallen below compliance standards. The following week, the April 13, 2022First High-School Education announced that its total revenue for 2021 was barely 400.2 million RMBwhich represents a substantial deceleration in the second half of the year.
Then, on May 3, 2022First High-School Education filed a notice with the United States Securities and Exchange Commission that it would not be able to timely file its annual report on Form NT 20-F.
By May 10, 2022First ADS of secondary education closed below $1 per ADS – more than 90% below the $10 per ADS price at which the ADS were sold to the investing public just over a year ago.
Wolf Haldenstein has extensive experience in prosecuting securities class action and derivative litigation in state and federal trial and appellate courts across the country. The firm has attorneys in various practice areas; and offices at New York, Chicago and San Diego. This firm’s reputation and expertise in shareholder litigation and other class actions have been repeatedly recognized by the courts, which have appointed it to major positions in complex, multi-district and consolidated securities litigation.
If you wish to discuss this action or have any questions regarding your rights and interests in this case, please contact immediately Wolf Haldenstein by phone at (800) 575-0735 or by email at [email protected]
Wolf Haldenstein Adler Freeman & Herz LLP
Patrick Donovan, Esq.
Gregory Pierredirector of business and financial analysis
E-mail: [email protected], [email protected] Where [email protected]
Tel: (800) 575-0735 or (212) 545-4774
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