WEST PALM BEACH, Fla., Aug. 23, 2004 (PRIMEZONE) -- An investor has sued The St. Paul Travelers Companies, Inc. ("St. Paul Travelers") (NYSE:STA), claiming the company and its predecessor misled the investing public about its business operations, financial results and reserves.
Berman DeValerio Pease Tabacco Burt & Pucillo (www.bermanesq.com) filed the class action on August 20, 2004 in the U.S. District Court for the District of Minnesota.
The lawsuit was filed on behalf of all former holders of Travelers Property Casualty Corp. ("Travelers") Class A and Class B common stock who acquired shares of The St. Paul Companies, Inc. ("St. Paul") common stock pursuant to St. Paul's materially false and misleading registration statement, which included the joint proxy statement/prospectus, as amended and filed with the U.S. Securities and Exchange Commission on February 13, 2004, in connection with the issuance of St. Paul's common stock to Travelers' shareholders in St. Paul's stock-for-stock merger with Travelers on April 1, 2004 (the "Merger") to form The St. Paul Travelers Companies, Inc.
To receive a copy of the complaint, you may contact the court, call the firm at (800) 349-4612 or go to http://www.bermanesq.com/pdf/StPaulCompanies-Cplt.pdf.
The lawsuit claims that the defendants violated Sections 11 and 15 of the Securities Act of 1933.
The complaint alleges that the defendants issued materially false and misleading statements about St. Paul's business operations, financial results and reserves which artificially inflated St. Paul's common stock. The lawsuit asserts that had the true facts about St. Paul been disclosed to Travelers' shareholders, they would not have voted to approve the Merger or would not have accepted the stock exchange ratio offered.
On July 23, 2004, less than four months after the closing of the Merger, the new St. Paul Travelers Companies announced that it would add $1.63 billion to reserves due to the need to increase reserves from St. Paul's business, which had reserved on a "less conservative" basis. The second quarter results were delayed to determine whether the combined company would have to reflect a second quarter loss on its income statements due to the increased reserves.
On August 5, 2004, St. Paul Travelers issued an announcement disclosing it had reported a $300 million second quarter loss due to the $1.63 billion reserve adjustments.
By the time the true extent of required reserve increase and its adverse impact against St. Paul Travelers were fully disclosed to the markets on August 5, 2004, the per-share price of St. Paul Travelers common stock had declined by $6.02 or 14.77% to close at $34.75 on August 5, 2003 -- causing massive losses to former Travelers shareholders.
If you owned Travelers' Class A and Class B common stock and acquired shares of St. Paul common stock as described above, you may wish to contact the following attorney at Berman DeValerio Pease Tabacco Burt & Pucillo to discuss your rights and interests.
Michael J. Pucillo, Esq. Northbridge Centre, Suite 1701 515 N. Flagler Drive West Palm Beach, FL 33401 (800) 349-4612 lawfla@bermanesq.com
If you wish to apply to be lead plaintiff in this action, a motion on your behalf must be filed with the court no later than October 15, 2004. You may contact the attorneys at Berman DeValerio to discuss your rights regarding the appointment of lead plaintiff and your interest in the class action, or you may submit information online at http://www.bermanesq.com/Securities/Signup1.asp?caseid=523.
Please note, you may also retain counsel of your choice and need not take any action at this time to be a class member.
Berman DeValerio Pease Tabacco Burt & Pucillo prosecutes class actions nationwide on behalf of institutions and individuals, chiefly victims of securities fraud, antitrust law violations, and consumer fraud. The firm consists of 32 attorneys in Boston, San Francisco and West Palm Beach, Florida.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca.