Atkore Faces Shareholder Lawsuit Over Alleged Price-Fixing Scheme

Atkore Inc. is facing a shareholder derivative lawsuit alleging that company executives concealed a price-fixing scheme that artificially boosted the financial performance of its water and electrical conduit pipe business. However, after these allegations surfaced, the company lowered its fiscal guidance, which sent its stock plummeting, according to Bloomberg.

The lawsuit, filed by shareholder Mike Blatzer in the U.S. District Court for the Northern District of Illinois, claims that Atkore misled investors about the reasons behind declining prices for its polyvinyl chloride (PVC) pipes.

The complaint points to the company’s February 4, 2025, earnings report, in which Atkore announced weaker-than-expected financial results and reduced its fiscal year 2025 adjusted earnings guidance, citing underperformance in its PVC pipe segment. According to Bloomberg, the company’s stock dropped nearly 20% that day, marking its worst single-day decline since March 2020.

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Atkore, a major manufacturer of electrical, safety, and infrastructure products, saw strong profits in its PVC pipe business during the COVID-19 pandemic as shipping costs soared, limiting competition from foreign manufacturers. However, as global supply chains stabilized and shipping prices normalized in 2022, international competitors re-entered the U.S. market, driving PVC pipe prices downward.

According to Bloomberg, Atkore repeatedly assured investors that these price declines were part of a natural market adjustment rather than the result of any internal misconduct. However, a July 24, 2024, report by activist investor ManBear challenged that narrative.

The report, titled “Pipe Price Fixing,” accused Atkore and three competitors of using the commodity pricing service OPIS to coordinate pricing and manipulate PVC pipe prices.

The lawsuit alleges that Atkore engaged in an anti-competitive scheme that inflated PVC pipe prices and misled investors about the company’s competitive position. When the truth came to light, the company was forced to revise its financial outlook, leading to the significant stock drop.

Source: Bloomberg