Were you Sold Private Market Opportunity – Vista Fund II by Oppenheimer?
In 2017, Oppenheimer Alternative Investment Management formed Private Market Opportunity – Vista Fund II, LLC, a Delaware limited liability company. The Fund was offered as a private placement to “a select group of sophisticated investors.” Upon having their subscription accepted, investors would become Members in the Fund. Oppenheimer Alternative Investment Management, LLC, also a Delaware limited liability company, was created to be the Managing Member of the Fund.
The Fund was organized to be a private “feeder fund” that invested substantially all of its assets in Linse Capital VAL, LLC, also a Delaware limited liability company. In turn, Linse Capital invested substantially all of its assets in securities of Valens, Inc. Valens is an Israeli fabless manufacturing company providing semiconductors for the automotive and audio-video industries. At the time of the Fund’s formation, Valens was attempting to leverage their technology for use in the global automotive industry. Specifically, Valens was attempting to use their technology to create the “connected car.”
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In Oppenheimer’s offering documents, they listed two likely liquidation scenarios for investors. The first scenario was an IPO for Valens and the second was a strategic acquisition of Valens by a global technology company. On May 25, 2021, Valens announced a “Business Combination” with PTK Acquisition Corp. (“PTK”), a special purpose acquisition company in a transaction valued at approximately $1.1 billion. On September 29, 2021, Valens announced the completion of its Business Combination with PTK. The newly combined company was to retain the name “Valens” and begin trading on the New York Stock Exchange (“NYSE”) on September 30, 2021, under the ticker “VLN.”
What is a Private Placement like Vista Fund II?
A private placement is a non-public offering used to raise capital. An offering that is not a public offering is exempted under Regulation D of the Securities Act from SEC registration. These investments are often sold to “accredited investors” by various broker-dealers. Private placement investments are generally illiquid, meaning they cannot be readily sold and are not traded on the open market. Private placements are typically promissory notes, LLCs, or Limited Partnerships.
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What Are Potential Problems with Private Placements?
- They may lack transparency and liquidity.
- The investments can be hard to understand.
- Regulatory oversight may be slim for private placements.
- There’s a risk of investment fraud.
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Problems for Investors in Vista Fund II
In a letter dated August 30, 2021, investors in Vista Fund II were advised of the acquisition of Valens and informed of a completion timeline for the transaction. Notably, investors were notified that Linse Capital had signed a “lock-up agreement” which restricted it from transferring or distributing the securities it held to Members for six months following the transaction. Since listing on the NYSE, VLN has suffered from a precipitous decline. Originally opening at $9.75, VLN has fallen almost 80% and currently trades at just over $2. With this sharp decline in price, the “six month” timeline provided to investors has not been honored. 18 months after the completion of the transaction, Members of Vista Fund II have had their requests for shares denied and they find themselves in the situation where they see their investment declining everyday without the ability to do anything about it.
Why Meyer Wilson Can Help Vista Fund II Investors
At Meyer Wilson, we represent investors who have suffered losses due to investment fraud or broker misconduct. Our lawyers have secured over $350 million on behalf of clients nationwide. We have represented over a thousand investors and will fight for you and your family.
If you invested in Vista Fund II or another similar fund, you need to contact our office to schedule a free consultation. Call 866-938-2021 to speak directly with an experienced investment fraud lawyer. We have decades of combined legal experience and are nationally recognized for our successful litigation and arbitration of investment fraud cases. Do not hesitate. Call now to get started.
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