Ryde hit by pump-and-dump class action, shareholder petition

Ryde, a ride-hailing company based in Singapore, is facing two separate legal cases: a shareholder petition and a class action lawsuit. The latter accuses the NYSE-listed firm of involvement in a pump-and-dump scheme.

A pump-and-dump scheme involves fraudsters artificially “pumping” up the price of a traded financial instrument through false or misleading positive statements and then “dumping” their holdings at the peak.

The class action lawsuit was filed in the Southern District of New York, under the US District Court, on September 10.

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Separately, Octava Fund, a shareholder of Ryde Group, submitted a petition to the Grand Court of the Cayman Islands on July 3. Octava calls for Ryde’s 6.9 million shares to be bought out or for the company to be wound up on grounds of improper governance, breach of duty, and other issues. Both firms are incorporated in the Cayman Islands.

Ryde responded via a media statement on September 18.

On the shareholder petition, it said: “The proceedings remain at an early stage and no findings have been made by the court on the substantive allegations. No official or provisional liquidator has been appointed, the directors remain in control of the company, and the proceedings have not affected the company’s operations or its ability to conduct business in the ordinary course.”

Regarding the class action lawsuit, Ryde said it intends to “engage litigation counsel and actively defend the action.”

In response to queries from The Business Times, the ride-hailing platform said it has no further comment.

Shareholder petition

Singaporean Terence Zou founded Ryde as Ryde Technologies in 2014. He is currently the CEO and chairman of Ryde Group.

The platform began as a carpooling app but later expanded to ride-hailing and delivery services. It went public in March 2024.

In its petition, Octava Fund said it has “…justifiably lost all trust and confidence that the assets and affairs of the company [Ryde] are being properly managed and mutual trust and confidence between the petitioner and the company has irretrievably broken down.”

According to the petition, at one point in 2019, Ryde was on the brink of insolvency and unable to meet its payroll obligations. Octava Fund bought out the shares of its principal investor, Nomad X, and became majority shareholder in January 2020.

Class action lawsuit