Obalon Securities Investigation As a Result of the Company’s Cancellation of a Previously Announced Public Stock Offering of 5,454,545 Common Stock Shares
Kehoe Law Firm, P.C. is investigating claims on behalf of Obalon investors to determine whether Obalon Therapeutics and certain of its officers or directors engaged in securities fraud or other unlawful business practices.
On January 23, 2018, Obalon Therapeutics, Inc., “a San Diego-based company focused on developing and commercializing novel technologies for weight loss,” issued a press release
. . . announc[ing] the termination of the underwriting agreement and cancellation of its previously announced public offering . . . of 5,454,545 shares of its common stock at a public offering price of $5.50 per share.
UBS Investment Bank, Canaccord Genuity and Stifel were acting as joint book-running managers for the offering. BTIG was acting as a co-manager. The offering was being made pursuant to a shelf registration statement . . . previously filed with and declared effective by the U.S. Securities and Exchange Commission.
[Obalon’s] [o]ffering was scheduled to close on January 23, 2018. However, a purported whistleblower contacted KPMG LLP, [Obalon’s] independent auditors, to make certain allegations relating to allegedly improper revenue recognition during [Obalon Therapeutics’] fourth fiscal quarter of 2017 (“Q4 2017”). These allegations were reported to Obalon late in the day on January 22, 2018, making it infeasible for the [Obalon] to complete an investigation of the allegations prior to the intended closing of the public offering.
Obalon’s Audit Committee will oversee an internal investigation of these allegations . . .. [Obalon Therapeutics] is currently unable to predict the timing or outcome of the [i]nvestigation. Based on information known at this time, [Obalon’s] management does not currently believe material adjustments to the preliminary, unaudited revenue for Q4 2017 and full year 2017 previously reported by [Obalon] will be required as a result of these allegations. [Obalon Therapeutics] intends to make a further announcement regarding the outcome of the Investigation as soon as practicable.
Obalon’s Announcement of The Cancellation of Its Public Stock Offering Results in OBLN Stock Drop
On the news of the cancellation of its public stock offering, Obalon’s stock dropped $1.73, or 33.33%, to close at $3.46 on January 23, 2018.
Obalon Therapeutics, Inc.
. . . an engineering-driven medical technology company with a singular focus on innovative, high-quality gastric balloon technology. Located in San Diego, California, the technical team at Obalon has a long history of working closely with leading clinicians to develop innovative medical products that revolutionize treatment of chronic disease. As a company, [Obalon] believe[s] in the fundamental value of imagination and invention, combined with rigorous testing and analysis, to ensure the highest levels of safety and performance. The result is a user-focused approach that deploys the power of advanced technological thinking to support clinical treatment objectives.
Obalon Therapeutics Stock Holders
If you own, or otherwise acquired, Obalon stock and have questions or concerns about Kehoe Law Firm’s class action investigation, please contact John Kehoe, Esq., (215) 792-6676, Ext. 801, [email protected], complete the form above on the right or e-mail [email protected].