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BOCA RATON, Fla., July 30, 2019 (GLOBE NEWSWIRE) -- Saxena White P.A. has filed a securities fraud class action lawsuit in the United States District Court for the Eastern District of Virginia against GTT Communications, Inc. (“GTT” or the “Company”) (NYSE: GTT) on behalf of all persons or entities who purchased or otherwise acquired GTT common stock between February 26, 2018 and July 1, 2019, inclusive (the “Class Period”).
If you purchased GTT common stock during the Class Period and wish to apply to be lead plaintiff, a motion on your behalf must be filed with the Court by no later than September 30, 2019. You may contact David Kaplan (email@example.com), an attorney and Director at Saxena White P.A., to discuss your rights regarding the appointment of lead plaintiff or your interest in the class action. You may also retain counsel of your choice and need not take any action at this time to be a class member.
GTT provides cloud networking services to multinational companies. Since 2015, the Company pursued growth through a roll-up strategy in which it would acquire relatively small companies through “tuck-in” acquisitions. However, in February 2018, in sharp contrast to its historical strategy of acquiring smaller companies, GTT announced that it was purchasing Interoute Communications Holdings S.A. (“Interoute”), a telecommunications company that operated Europe’s largest cloud services platform in a transformational $2.3 billion acquisition that essentially doubled GTT’s size.
Throughout the Class Period, GTT assured investors that it had conducted extensive due diligence on Interoute, and the acquisition was a natural strategic fit for GTT—that the two companies “fit together almost hand in glove.” After the deal closed, GTT assured investors that Interoute’s integration into the Company was “on track” and “not as complex” as many of the Company’s previous integrations.
Investors began to learn the truth on May 8, 2019, when GTT disclosed a larger than expected loss for the first quarter of 2019, including a sequential decline in revenues. GTT blamed its poor performance on a host of issues with the Interoute integration, including migrating legacy systems into GTT’s management database, discrepancies with Interoute’s billing systems, and a poor salesforce. GTT further disclosed that shortly before the acquisition, Interoute had made a strategic shift to sell cloud services that deviated from GTT’s core cloud networking business. In response to these disclosures, GTT’s stock price plummeted 17.5% on May 8, 2019, and continued to fall the following day, for a two-day decline of over 25%.
The Complaint asserts claims for violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 against GTT and certain of its senior executives (“Defendants”). The action alleges that during the Class Period, Defendants issued a series of false and/or misleading statements and failed to disclose material adverse facts about GTT’s business, operations, and prospects, and the Interoute acquisition specifically. Among other things, Defendants failed to disclose that: (1) there were delays in migrating Interoute’s legacy systems and processes into GTT’s client management database system; (2) Interoute had made a strategic shift to focus on providing cloud services that deviated from GTT’s core cloud networking business; (3) Interoute’s sales force was underperforming and ineffective at selling GTT’s core cloud networking services; and (4) as a result of the foregoing, Defendants’ public statements were materially false and/or misleading and/or lacked a reasonable basis.
You may obtain a copy of the Complaint and inquire about actively joining the class action at www.saxenawhite.com.
Saxena White P.A., with offices in Florida, New York, and California, concentrates its practice on prosecuting securities fraud and complex class actions on behalf of institutions and individuals. Currently serving as lead counsel in numerous securities fraud class actions nationwide, the firm has recovered hundreds of millions of dollars on behalf of injured investors and is active in major litigation pending in federal and state courts throughout the United States.