Federman & Sherwood Announces Investigation of China Advanced Construction Materials Group, Inc.
August 04 2011 - 5:25PM
Business Wire
The law firm of Federman & Sherwood has initiated an
investigation into China Advanced Construction Materials Group,
Inc. (NASDAQ: CADC) (“CADC” or “Company”) and its Board of
Directors with respect to possible breaches of fiduciary duty by
the company and its officers and directors, as well as violations
of state law, arising from the proposed acquisition of all
outstanding shares of CADC common stock by the Company’s largest
shareholders, Chairman of the Board and CEO, Xianfu Han (“Han”) and
Vice-Chairman of the Board and COO, Weili He (“He”).
On July 26, 2011, CADC announced that it had received an offer
from Mr. Han and Mr. He to acquire all outstanding shares of common
stock not currently owned by them in a going-private transaction at
a proposed price of $2.65 per share, in cash. Mr. Han and Mr. He
currently own, cumulatively, approximately 49% of the company’s
common stock. Federman & Sherwood is investigating whether the
proposed sale of stock will irreparably harm other shareholders if
the Company allows the sale of all remaining common stock to be
sold to Mr. Han and Mr. He; and, whether the consideration to be
paid by Mr. Han and Mr. He for said stock is unfair, inadequate and
substantially below the fair market value of CADC shares. According
to various financial analysts, a low target price for CADC stock is
$4.00 per share, with a high target price of $5.00 per share.
Additionally, CADC stock has traded as high as $5.39 per share as
recently as January 11, 2011, and has closed above the $2.65 share
offer price as recently as May 26, 2011. Federman & Sherwood
questions whether the officers and directors have taken all steps
necessary to maximize shareholder value in relation with the
possible change in control of China Advanced Construction
Materials.
If you currently own common stock in China Advanced Construction
Materials Group, Inc., have information to assist in our
investigation, or have any questions or concerns regarding this
notice or preservation of your rights, please contact William B.
Federman. Federman & Sherwood has extensive experience
representing investors in securities, derivative and merger-related
shareholder class actions in state and federal courts
nationwide.
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