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In a letter to the investment bank on Tuesday, Lyft reportedly threatened lawsuits against Morgan Stanley, accusing the company of supporting short selling for investors subject to lock-up agreements.
In this letter, Lyft questioned the company about its alleged role in marketing certain products that would help investors before the IPO to bet against the title, according to a CNBC report citing this letter and unidentified sources . The letter was signed by Peter Stris of the law firm Stris & Maher, who represented Lyft's lawyer, reported CNBC.
Lyft and Stris & Maher did not respond to requests for comment.
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This development follows a report released Monday by the New York Post that Morgan Stanley deliberately helped investors before the IPO to protect against a decline in shares, despite the so-called "blocking" agreements intended to prevent them from doing it. Morgan Stanley is the principal underwriter of the upcoming IPO of Uber, Lyft's biggest rival in carpooling.
La Poste also indicated that the blocking agreements were written in such a way as to allow Lyft Investors to make limited "short" bets. Short sellers are investors who bet that Lyft will lose value.
According to CNBC, Morgan Stanley did not formally respond to the letter.
However, in a statement to FOX Business, a spokesman for Morgan Stanley denied having performed, "directly or indirectly, a sale, short sale, hedge, exchange or transfer of risk or value associated with the shares. of Lyft for any Lyft shareholder identified by the company or otherwise known to be the subject of a lock-up agreement with Lyft.
"The activities of our company are normally in the process of market creation and any suggestion that Morgan Stanley has attempted to apply a" short press "to Lyft is false," the spokesman said.
The information first reported on the threat of a lawsuit by Lyft.
| Teleprinter | security | Latest | Change | % Chg |
|---|---|---|---|---|
| LYFT | LYFT INC. | 74.45 | + 2.45 | + 3.40% |
Lyft, valued at about $ 24 billion, debuted at the end of March, trading initially at $ 87.24 each – well above the $ 72 a share it was quoted. This was one of the most anticipated IPOs of the year. Lyft closed at $ 74.45 per share on Friday.
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