CVR Refining, LP

On July 30, 2018, CVRR announced that the General Partner, CVI, and other affiliates now owned 84.5 percent of the outstanding CVRR common units, and could exercise the buyout provision in CVRR’s partnership agreement (the “Call Right”). Under the Call Right, the General Partner had the right to acquire all remaining CVRR units for a specified price. On August 1, 2018,  the Company stated that there were “no current plans to exercise the call right.”

On October 24, 2018, CVRR released its third quarter 2018 financial results, a significant increase over the prior year results. 

On November 29, 2018 it was now “considering” exercising the Call Right, and that neither it, nor any of its affiliates, had purchased CVRR units in the 90-day period predating the announcement, further driving down the CVRR unit price. Then, on January 17, 2019, CVRR issued a press release announcing the General Partner had assigned the Call Right to CVI, and that CVI would exercise the Call Right on January 29, 2019, “for a cash purchase price of $10.50 per Common Unit,” which price was based on the 20-day trading average of CVRR units ending on January 14, 2019.

The complaint alleges that defendants made false and/or misleading statements and/or failed to disclose:  (1) that following the Exchange Offer, reduced public float and the threat of the Call Right began depressing the price of CVRR units, more than offsetting favorable financial results; (2) that as the price for CVRR units stagnated, and more than 90 days had passed since expiration of the Exchange Offer, Defendants announced that they were "considering" exercising the Call Right to further drive down the unit price; and (3) as a result, once the price of CVRR units had substantially declined, Defendants exercised the Call Right, which price was based on the (manipulated) 20-day trading average of CVRR units.