A lawsuit was filed on behalf of investors in VNET Group, Inc. (NASDAQ: VNET) shares over alleged securities laws violations.

An investor, who purchased shares of VNET Group, Inc. (NASDAQ: VNET), filed a lawsuit over alleged violations of Federal Securities Laws by VNET Group, Inc.

Investors who purchased shares of VNET Group, Inc. (NASDAQ: VNET) have certain options and for certain investors are short and strict deadlines running. Deadline: February 26, 2024. NASDAQ: VNET investors should contact the Shareholders Foundation at mail@shareholdersfoundation.com or call +1(858) 779 - 1554.

China based VNET Group, Inc., an investment holding company, provides hosting and related services in China. In August 2021, VNET Group's co-founder, Josh Sheng Chen, and his companies entered into a $50.25 million margin loan facility with Bold Ally (Cayman) Limited ("Bold Ally"), pledging all of his shares in GenTao Capital Limited ("GenTao") and certain companies as collateral (the "Facility Agreement"). Sheng Chen, GenTao, and their affiliates beneficially owned approximately 78.52 million VNET Group shares.

On February 13, 2023, before the market opened, Bold Ally announced it would exercise its rights under the Facility Agreement following a default by GenTao and was entitled to 48,515,634 Class A ordinary shares (in the form of 8,085,939 American depositary shares, or "ADSs" or "shares") and 27,757,992 Class B ordinary shares of the Company.

On February 15, 2023, VNET Group, Inc. announced that "its board of directors (the "Board") approved and authorized the issuance of up to 555,000 newly created Class D ordinary shares to Mr. Sheng Chen, the Executive Chairman of the Board. The Class D ordinary shares will have the same rights as the Company's existing Class B ordinary shares except for voting rights, and holders of Class D ordinary shares shall be entitled to 500 votes per share on all matters submitted to shareholder vote." In addition, the press release stated the "issuance of the newly created Class D ordinary shares is an initiative by the Board to protect the Company's interests and continued stability."

Shares of VNET Group, Inc. (NASDAQ: VNET) declined from $6.83 per share on January 20, 2023, to as low as $2.53 per share on May 25, 2023.

The plaintiff claims that between April 8, 2022 and February 15, 2023, that the Defendants failed to disclose to investors that GenTao was experiencing financial difficulties and was at risk of defaulting on the Facility Agreement, that, as a result, there was a substantial likelihood that Bold Ally would acquire Defendant Sheng Chen's significant ownership stake in VNET, that, to restore Defendant Sheng Chen's voting interest in VNET, the Company would issue newly created shares to Defendant Sheng Chen, diluting investors' interest, that, as a result of the foregoing, Defendants' positive statements about the Company's business, operations, and prospects were materially misleading and/or lacked a reasonable basis.

Those who purchased shares of VNET Group, Inc. (NASDAQ: VNET) have certain options and should contact the Shareholders Foundation.

Contact:
Shareholders Foundation, Inc.
Michael Daniels
3111 Camino Del Rio North - Suite 423
92108 San Diego
Phone: +1-(858)-779-1554
Fax: +1-(858)-605-5739
mail@shareholdersfoundation.com

About Shareholders Foundation, Inc.
The Shareholders Foundation, Inc. is a professional portfolio monitoring and settlement claim filing service, , which does research related to shareholder issues and informs investors of securities class actions, settlements, judgments, and other legal related news to the stock/financial market. Shareholders Foundation, Inc. is in contact with a large number of shareholders and offers help, support, and assistance for every shareholder. The Shareholders Foundation, Inc. is not a law firm. Referenced cases, investigation, and/or settlements are not filed/reached and/or related to Shareholders Foundation. The information is provided as a public service. It is not intended as legal advice and should not be relied upon.