Investigation of Ascena Retail Group, Inc.
Ascena Retail Group, Inc. (ASNA) Accused of Misleading Shareholders
Ascena touted its acquisition of ANN Inc. as positive and having potential for continued growth. However, Ascena’s acquisition of ANN Inc. was a complete disaster from the beginning due to ANN Inc.’s poor business operations. Ascena’s officers and directors concealed this reality from investors by improperly delaying their recognition of an impairment charge made on the value of ANN Inc.’s goodwill. This resulted in materially overstated financial results, including the overvaluing of declining ANN Inc. brands. Despite the adverse facts about the acquisition, Ascena’s officers and directors continued to mislead investors by positively assuring the viability and growth of the company following the acquisition of ANN Inc. On May 17, 2017, Ascena issued a press release that reported their entire fiscal year’s sales, revealing a 6-7% drop despite the positive assurances of Ascena executives. On this news, the price of Ascena stock dropped from $2.82 per share to $2.06 a share, a 26% decline. The stock never recovered and now trades at under $1.00.
Ascena Retail Group, Inc. (ASNA) Shareholders Have Legal Options
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