SHAREHOLDER ALERT: Pomerantz Law Firm Investigates Claims On Behalf of Tower Semiconductor Ltd. - TSEM

14 Jan, 2016, 12:05 ET from Pomerantz LLP

NEW YORK, Jan. 14, 2016 /PRNewswire/ -- Pomerantz LLP is investigating claims on behalf of investors of Tower Semiconductor Ltd. ("Tower Semiconductor" or the "Company") (NASDAQ: TSEM).  Such investors are advised to contact Robert S. Willoughby at rswilloughby@pomlaw.com or 888-476-6529, ext. 9980.

The investigation concerns whether Tower Semiconductor and certain of its officers and/or directors have violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.

On January 14, 2016, Spruce Point Capital Management published a report on Tower Semiconductor entitled "Leaning Tower of Losses."  Among other issues with the company, Spruce Point described "Evidence Suggesting [a] Brazen Accounting Scheme to Forestall [a] Bankruptcy Threat."  Per Spruce Point's report: "Tower may have heavily promoted [a joint venture deal with] Panasonic . . . to inflate its stock, and convert its Series F debt to equity to relieve its debt burden.  We have evidence to suggest Tower inflated the value of the [joint venture's] assets from approx.. $100m to $300m in order to inflate a bargain purchase gain to bolster its equity.  Furthermore, Tower has engaged in other questionable accounting maneuvers to give the appearance of strong Non-GAAP gross margins, profitability, and free cash flow such as: 1) Shifting COGS expenses to R&D and SG&A; 2) Changing the presentation of capex from "gross" to "net"; 3) Extending the useful life of its assets to reducing depreciation expense; 4) Excluding depreciation and amortization to present Non-GAAP results (not industry standard); 5) Haircutting its convertible and bank debt by inappropriately interpreting the accounting guidance." 

On this news, Tower Semiconductor stock has fallen as much as $1.81, or 14.5%, to $10.66 during intra-day trading on January 14, 2016.

The Pomerantz Firm, with offices in New York, Chicago, Los Angeles, and Florida, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 70 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com.

CONTACT: Robert S. Willoughby Pomerantz LLP rswilloughby@pomlaw.com

 

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