- Oops!Something went wrong.Please try again later.
NEW YORK, September 03, 2021--(BUSINESS WIRE)--The law firm of Kirby McInerney LLP announces that a class action lawsuit has been filed in the U.S. District Court for the Southern District of New York on behalf of those who acquired Katapult Holdings, Inc. f/k/a FinServ Acquisition Corp. ("Katapult" or the "Company") (NASDAQ: KPLT) securities from December 18, 2020 through August 10, 2021, inclusive (the "Class Period"). Investors have until October 26, 2021 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
Katapult claims to be a "next-generation platform for digital and mobile-first commerce focused on the non-prime consumer," providing point-of-sale lease-purchase options for non-prime consumers who cannot access traditional financing products.
On June 9, 2021, Katapult became a public company via business combination with FinServ Acquisition Corp., a blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination with one or more businesses.
As recently as June 15, 2021, Katapult touted its "unique position" to serve a very large e-commerce market for durable goods purchased by non-prime consumers and its "disruptive technology" that empowers underserved consumers and simplifies the shopping experience to help them secure essential items for their daily lives. The Company claimed these factors supported its lofty 2021 financial guidance, projecting exponential growth in gross originations, and adjusted earnings before interest, taxes, depreciation, and amortization ("EBITDA").
On August 10, 2021, just 2 months after the merger closed and 2021 guidance was given, Katapult reported disappointing Q2 2021 financial results, reporting gross originations of only $64.4 million, down 17% year-over-year, as well as adjusted EBITDA of $3.9 million, down 64.8% year-over-year. In addition, the Company withdrew its 2021 guidance entirely, blaming the dismal outlook on changes in e-commerce retail sales outlook, uncertainty assessing consumer spending behavior, and COVID-19. On this news, the Company’s share price declined by $5.47 per share, or approximately 56.22%, from $9.73 per share to close at $4.26 per share on August 10, 2021.
The lawsuit alleges throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors: (1) that Katapult was experiencing declining e-commerce retail sales and consumer spending; (2) that despite Katapult’s assertions that it was clear and compelling value proposition to both consumers and merchants, transforming the way non-prime consumers shop for essential goods and enabling merchant access to this underserved segment, Katapult lacked visibility into its consumers future buying behavior; and (3) as a result, Defendants’ statements about its business, operations, and prospects were materially false and misleading, and/or lacked reasonable basis at all relevant times.
If you purchased or otherwise acquired Katapult securities, have information, or would like to learn more about these claims, please contact Thomas W. Elrod of Kirby McInerney LLP at 212-371-6600, by email at firstname.lastname@example.org, or by filling out this contact form, to discuss your rights or interests with respect to these matters without any cost to you.
Kirby McInerney LLP is a New York-based plaintiffs’ law firm concentrating in securities, antitrust, whistleblower, and consumer litigation. The firm’s efforts on behalf of shareholders in securities litigation have resulted in recoveries totaling billions of dollars. Additional information about the firm can be found at Kirby McInerney LLP’s website: http://www.kmllp.com.
This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.
View source version on businesswire.com: https://www.businesswire.com/news/home/20210903005447/en/