NEW YORK, Dec. 20, 2005 (PRIMEZONE) -- The following statement was issued today by Squitieri & Fearon, LLP.
You Are Hereby Notified that a Class Action has been filed in the United States District Court of Minnesota on behalf of all persons who purchased the common stock of Nash Finch Company (Nasdaq:NAFC) ("Nash" or "The Company"), between February 24, 2005 and October 20, 2005, (the "Class Period").
The Complaint charges that Nash and certain of its officers violated the Securities Exchange Act of 1934. On February 24, 2005, defendants announced a $220 million acquisition of Roundy's Distribution Center ("Roundy's"), a Midwest food distributor, which, according to defendants, was expected to add nearly $1 billion in yearly sales to the Company, be immediately accretive to earnings, and create approximately $10 million per year in cost savings. Unbeknownst to investors, however, defendants' statements were materially false and misleading because defendants knew, or recklessly disregarded, that (i) the Company was operating far below expectations; (ii) Nash had significantly under-reserved for the Roundy's acquisition; (iii) the integration of Roundy's was not proceeding according to plan; and (iv) the Company's core business was under-performing guidance.
On October 20, 2005, the last day of the Class Period, the Company issued a press release announcing significantly lower fiscal 2005 earnings guidance of $3.00 to $3.25 per share, from its previous guidance of $3.70 and $3.89. The Company attributed the lowered guidance to "a decline in retail gross profit margins, primarily reflecting inadequate execution in pricing across the Company's retail operations; depressed wholesale gross profit margins principally relating to manufacturer promotional spending; and higher than expected acquisition integration costs." In reaction to this news, the price of Nash stock fell $12.11 per share, or 35%, from its closing price of $42.34 on October 20, 2005, to close at $30.23 on the following trading day. Defendants engaged in the fraudulent and wrongful conduct to sell more than $300 million in notes in a private placement and in order for Company insiders to sell more than $17 million of their privately-held Nash shares while in possession of material adverse non-public information about the Company.
If you are a member of the class described above, you may not, later than February 17, 2006, move the court to serve as lead plaintiff of the Class, if you so choose. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the lead plaintiff's claim is typical of the claims of other class members, and that the lead plaintiff will adequately represent the class. Under certain circumstances, one or more class members may together serve as "lead plaintiff". Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff.
The law firm of Squitieri & Fearon, LLP has significant experience prosecuting class actions on behalf of investors and shareholders. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact Philip P. Foote of Squitieri & Fearon, LLP at (212) 421-6492, Pfoote@sfclasslaw.com.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca