Parallel Petroleum Corporation Investors File Lawsuit

If you are currently an investor in shares of Parallel Petroleum Corporation (Public, NASDAQ:PLLL), and purchased the shares before September 15, 2009, and / or have additional information relating to the investigation, you should contact the Shareholders Foundation.

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Company Name(s): 
Parallel Petroleum Corporation
Case Name: 
Parallel Petroleum Class Action Lawsuit
Case Status: 
Lawsuit Filed
Affected Securities
NASDAQ: PLLL
Lawsuit Overview
Type of Lawsuit: 
Shareholder Class Action
Class Period End: 
09/15/2009
Summary: 

An investor filed a lawsuit on behalf of current investors Parallel Petroleum Corporation (Public, NASDAQ:PLLL), who purchased the shares before September 15, 2009, over alleged breaches of fiduciary duty and other violations of state law in connection with an alleged unfair takeover price were announced.

According to the complaint the plaintiff alleges potential breaches of fiduciary duty and other violations of state law by the Board of Directors of Parallel Petroleum Corporation (Public, NASDAQ:PLLL) arising out of their attempt to sell Parallel Petroleum Corp. to Apollo Global Management LLC. Parallel Petroleum Corporation (NASDAQ: PLLL) announced on September 15, 2009 that Parallel Petroleum has entered into a definitive agreement for Parallel Petroleum to be acquired by an affiliate of Apollo Global Management, LLC in a transaction valued at approximately $483 million. According to Parallel Petroleum Corporation the agreement was unanimously approved by Parallel’s Board of Directors. Under the terms of the agreement, Parallel Petroleum Corporation stockholders (NASDAQ: PLLL) would receive $3.15 per share in cash, representing a premium of 56 percent over Parallel’s average closing share price over the past thirty trading days and 63 percent over Parallel’s average closing share price over the past sixty trading days. But according to a previous investigation by a law firm “the transaction appears to be unfair” to current investors of Parallel Petroleum Corporation (NASDAQ: PLLL) because the Parallel Petroleum board failed “to conduct an open and fair auction process for Parallel Petroleum Corporation” and the “offer appears opportunistically timed to take advantage of the current economic downturn”.

According to another investigation by a law firm the investigation “concerns whether the Parallel Board of Directors breached their fiduciary duties to Parallel shareholders given that the Company's shares traded at a 52-week high of over $11.00 per share and the median price target for Parallel stock set by analysts is $4.00 per share, with a high target of $7.00 per share”. Parallel Petroleum Corporation, located in Midland, Texas, is engaged in the acquisition, development and exploitation of long lived oil and natural gas reserves and, to a lesser extent, the exploration for new oil and natural gas reserves. Majority of Parallel Petroleum Corp’s producing properties are in the Permian Basin of west Texas and New Mexico, Fort Worth Basin of North Texas and the onshore Gulf Coast area of South Texas. Parallel Petroleum Corporation reported in 2007 Total Revenue of $116.03million and in 2008 Total Revenue of $ 182.51million. Shares of Parallel Petroleum Corporation (Public, NASDAQ:PLLL) traded at $3.16 per share after the announcement and at $3.00 per share the day before the announcement. Parallel Petroleum Corporation shares (NASDAQ:PLLL) were down from a 52weekHigh of $11.13 per share, almost $23 per share in 2008, and over $24 per share in 2007.