GDS Holdings Limited Securities Litigation

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Lawsuit Overview

Defendant:GDS Holdings Limited
Date Filed:August 2nd, 2018
Sector:Technology
Industry:Computer Software: Programming, Data Processing
Class Start Date:November 2nd, 2016
Class End Date:July 31st, 2018

Plaintiff's law firm issued a press release on August 2, 2018, announcing the law suit. According to the press release, on July 31, 2018, Blue Orca Capital released a report alleging that "GDS is borrowing crippling amounts of debt to enrich insiders by acquiring data centers from undisclosed related parties which are not nearly as valuable as the Company claims. We believe that since becoming a public Company, GDS has borrowed recklessly to siphon off at least RMB 696 million to insiders by inflating the purchase price of undisclosed related party acquisitions."

Following this report, the Company's shares plunged more than 38%.

The complaint alleges that between November 2, 2016 and July 31, 2018, inclusive (the "Class Period"), Defendants made 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 that: (1) the Company has overstated its utilization and occupancy rates; (2) it has made acquisitions with related parties at inflated prices; (3) it has used suspect capital and debt raisings despite large off-shore cash reserves; (4) it has adopted unorthodox accounts receivable and payable practices; and (5) that, as a result of the foregoing, Defendant's statements about GDS' business, operations, and prospects were materially false and/or misleading and/or lacked a reasonable basis.

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First Identified Complaint

Chris Allison, et al. v. GDS Holdings Limited, et al.

Date Filed:August 2nd, 2018
Class Period Start:November 2nd, 2016
Class Period End:July 31st, 2018
First Identified Complaint Filings
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