Duoyuan global water fell 40%, and the cfo resigned. In a 3page report released tuesday, muddy waters said olam may need to raise or refinance as much as 4. One aspect dealt with muddy waters failing to report the build up of a. Olam to file lawsuit against muddy waters in singapore. The attack is the biggest crisis that olam has faced in the 22 years since it was founded. China mediaexpress fell 28%, then had to be halted, then the cfo of the company resigned, and then the company was delisted altogether. Singapores olam refutes muddy waters report marketwatch. Olam dismisses muddy waters report findings land observatory. Singapore almost a year after it first released its report on olam international, shortselling research firm muddy waters is not letting up on the agricommodities trader yet. In fact, its 45 pages long in short, this is olam s position. Muddy waters, which rose to prominence starting in 2011 with bearish research on chinese companies trading in the u. Muddy waters in 2012 said it believed olam was likely to fail because its debt load and poor management of. Shortseller muddy waters published a longawaited report on olam international with detailed attacks on acquisitions and accounting at the singapore commodities firm it has said may fail, but.
Singapores olam says will respond to muddy waters report. Muddy waters has trained its eye on a number of other firms in the past, most notably chinas sino forrest, with varying degrees of success. Initiating coverage on olam international strong sell margin. Jude medical devices used during our tests were provided by medsec. Muddy waters research, the short selling firm, on tuesday warned that olam, the asian commodity business, runs a high risk of failure amid. Muddy waters rated singaporebased olam a strong sell in a 3page report posted on its website today, saying it values olam on a liquidation basis, because our opinion is that it is likely to.
Clipping is a handy way to collect important slides you want to go back to later. Olam has since issued its rebuttal, though not answering every accusation. Muddy waters, the famous short biased research firm, has a new report on olam international ltd sgx. Olam reassures with detailed defence against muddy waters. As a short selling research firm, muddy waters mw earned its reputation by. In the two and onehalf years muddy waters, llc has been openly criticizing publiclytraded companies, we have not seen a response as defensive as yours not even from sinoforest. He has also released reports on companies including noble group, focus media, olam international. If you continue without changing your settings, well assume that you are happy to receive all cookies on the website. Muddy waters research llc is a privately held due diligence based investment firm that. On monday, 19 november 2012, during a speech at the investment forum in london, carson block, the founder and research director of muddy waters llc mw, challenged olam international olam, a major agricultural trading company on the singapore exchange. Interviewupdate 1olam says has enough cash, wont tap. Late monday, muddy waters issued a scathing report on olam, saying it runs a high risk of failure.
Shortselling investment research firms like muddy waters. The ongoing tussle between muddy waters and singapore commodities firm olam international further heated up after the shortseller. On monday, our director of research gave a brief talk on olam. Mw learned from john hempton how to catch fmcn in another lie. Olam is one of the worlds largest suppliers of cocoa beans and products, coffee, cotton and rice. Use of muddy waters reports is limited by the terms of service on its. Muddy waters research, the short selling firm, on tuesday warned that olam, the asian commodity business, runs a high risk of failure amid possible accounting malfeasance and significant. The rebuttal focused on major issues raised by muddy waters in its own lengthy report issued the day before. Following muddy waters report on why its shorting olam, released yesterday, the company has released a detailed defence. Report catalogues concerns about olam financial times. Muddy waters said olam was likely to fail in 2012 and called the shares worthless in a september report. Management talks about the gestation of these projects, but our research makes clear that they are. Muddy waters readily admits that some time prior to releasing its report, it had already shorted the stock. Muddy waters rated olam a strong sell in a 3page report posted on its website today saying it values olam on a liquidation basis because our opinion is that it is likely to fail.
In november 2012, olam was the first company to be targeted by muddy waters, who asserted that its business model was no longer viable. The firm muddy waters research further stated that olam was on the verge of bankruptcy. Magna cum fraude, the commodities supplier olam was dubbed a black box with. Initiating coverage on olam international muddy waters research. Olam international disputes accusations by shortseller.
Carson block sticks by china short calls as buyers circle. Muddy waters reaction to olam frantic response published. Update 2muddy waters report faults olam accounting, warns. Olam s share price tumbled after the accusations were made public. Now customize the name of a clipboard to store your clips. Olam international is a leading food and agribusiness company in the world, operating from seed to shelf in 70 countries, supplying food and industrial raw materials to over 23,000 customers worldwide. Block slapped olam with a strong sell rating, noting that his firm believes olam s value is. The rebuttal focused on major issues raised by muddy waters in its own report, released tuesday. The primary complaint made against olam by muddy waters was that olam allegedly made aggressive use of noncash accounting gains, particularly when reporting on olams biological assets. We use cookies to ensure you get the best experience on our website. The ongoing tussle between muddy waters and singapore commodities firm olam international further heated up after the shortseller published a muchawaited 3page report on tuesday detailing.
After a muddy waters report, rino international fell 60%. Olam writeup 23 nov 2012 final lion global investors. In typical singaporean style, olam which counts temasek holdings as a major shareholder also filed a defamation suit in a singapore court against muddy waters. Olam s solvency, accountingrelated assertions, business model, acquisitions and. Muddy waters retains our original investment thesis and strong sell rating on olams. Muddy waters research, muddy waters capital andor the muddy waters related persons intend to continue transacting in the securities of covered issuers for an indefinite period after an initial report on a covered person, and such person may be long, short, or neutral at any time hereafter regardless of their initial position and views as. Singapore, nov 27 reuters singapores olam international ltd said on tuesday it will assess shortseller muddy waters report on the commodity trader. Shortselling is a trading technique used by investors to make money from the falling price of assets.
The proposal comes after a tumultuous stretch for olam, one of the worlds leading traders in rice, coffee and cocoa, that saw it come under attack from shortseller muddy waters in. In the two and onehalf years muddy waters, llc has been openly. Olam s rebuttal, made in a 45page statement to singapore exchange, the citys stockmarket regulator, came less than 24 hours after shortseller carson block and his research firm, muddy waters. To olam ceo sunny verghese and the board of directors. Getting rich off chinese fraud on wall street public. The primary complaint made against olam by muddy waters was that olam allegedly made aggressive use of noncash accounting gains, particularly when reporting on olam s biological assets. Carson block backs china short calls as buyers circle. Muddy waters said in a 3page report early this week that olam s highly levered balance sheet, low operating margins and continued capital expenditures and acquisitions would require it to. Olam, on the other hand, has once before faced criticism in a report by hong kong broking group clsa. During the analysis my team replicated where possible, and using only the technical details provided by medsec, the research and attacks described by muddy waters in its report. Last week, muddy waters released a full 3page report detailing their allegations. After muddy waters went public with its accusations, olam s stock price declined by 9. Similar initiatives are likely to emerge, coming from china where many companies have fallen. The singapore based company was the target of muddy waters in late 2012, but there has been little news on the topic as of late.
Shortseller muddy waters published a longawaited report on olam international with detailed attacks on acquisitions and accounting at the singapore commodities firm it. He said that muddy waters was looking to profit from its short positions on olam shares. On monday, our director of research gave a brief talk on olam at a wellrespected. We think the only way off at this point is to fall, muddy waters said.
Some have questioned muddy waters actions, given concerns over possible conflicts of interests. We would note that at the time of writing, the awaited report by block muddy waters has not been released. Its asset heavy strategy appears to be an offtherails capex and acquisition binge. Muddy waters claims to have done extensive research and that olam is. Muddy waters report faults olam accounting, warns on risks. The muddy waters report released in june 2011 compared sino forest to madoffs ponzi scheme. It alleged that the value of property, plant and equipment held by crown flour mills cfm, a nigerian. Muddy waters issues critical olam report financial times. Muddy waters attacks olams purchases, likens to enron. Muddy waters reaction to olam frantic response muddy. Olam international limited archives muddy waters research.
Olam s solvency, accountingrelated assertions and the companys business model, acquisitions. Olam dismisses muddy waters report findings everyone is entitled to their own opinions, but they are not entitled to their own facts senator daniel patrick moynihan 19272003 the muddy waters report on olam was published on the afternoon of tuesday 27th november in singapore. A shortseller report by muddy waters in november 2012 led to a period of significant price uncertainty of olams listed share price and a pause. Muddy waters has just issued a new report attacking olam and stating that the company likely cannot repay its debt and shares are worthless.
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