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BENSALEM, Pa., November 23, 2021--(BUSINESS WIRE)--Law Offices of Howard G. Smith announces that a class action lawsuit has been filed on behalf of investors who purchased Zhangmen Education Inc.("Zhangmen" or the "Company") (NYSE: ZME) American Depositary Shares ("ADSs or shares") pursuant and/or traceable to the registration statement and prospectus (collectively, the "Registration Statement") issued in connection with the Company’s June 2021 initial public offering ("IPO"). Zhangmen investors have until January 18, 2022 to file a lead plaintiff motion.
Investors suffering losses on their Zhangmen investments are encouraged to contact the Law Offices of Howard G. Smith to discuss their legal rights in this class action at 888-638-4847 or by email to email@example.com.
In June 2021, Zhangmen, an education company focused on providing personalized online courses to K-12 students in China, conducted its IPO, selling 4,166,450 ADSs at a price of $11.50 per ADS.
Then, on July 23, 2021 China revealed an extensive overhaul of its education sector, prohibiting companies that teach the school curriculum from making profits, raising capital or going public. This effectively ended China’s $120 billion private tutoring industry.
On July 26, 2021, Zhangmen issued a release stating that these new guidelines were likely "to have material impacts on our existing business operations, financial condition and corporate structure."
Then, on November 19, 2021, Zhangmen announced that its independent auditor had resigned.
On November 19, 2021, the Company’s share price closed at $1.47 per ADS, an 80% decline from the IPO price.
The complaint filed in this class action alleges that the Registration Statement failed to disclose that: (a) the People’s Republic of China ("PRC") authorities were in the process of implementing sweeping new regulatory reforms on the private education industry in China including, among others, prohibitions on: (i) profit-making by private education companies, (ii) engaging in core-curriculum tutoring on weekends and vacations, and (iii) capital-raising by companies like Zhangmen; (b) the known risks, events, and uncertainties noted in the Registration Statement were reasonably likely to have a material adverse effect on Zhangmen’s business; and (c) based on the foregoing, the statements in the Registration Statement concerning Zhangmen’s historical financial performance, market demand, and industry trends were materially incomplete, inaccurate, and misleading.
If you purchased Zhangmen ADSs, have information or would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Howard G. Smith, Esquire, of Law Offices of Howard G. Smith, 3070 Bristol Pike, Suite 112, Bensalem, Pennsylvania 19020, by telephone at (215) 638-4847, toll-free at (888) 638-4847, or by email to firstname.lastname@example.org, or visit our website at www.howardsmithlaw.com.
This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.
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