Gloves-off response to Resilient

The rumours, speculation and innuendo surrounding the Resilient stable of companies, which include Resilient, Fortress, Nepi Rockcastle and Greenbay, all came out into the open on Friday following the circulation of a “leaked” research note prepared by 36One Asset management and another prepared by a team of analysts from Arqaam Capital.

Resilient acknowledged the presence of the report just after the market’s close on Friday: “The report was published and disseminated anonymously, but authorship of it has been confirmed by 36One Asset Management Proprietary Limited (36One) which is said to have a large short position on companies identified in the report.

“The content of the report and its dissemination follow a campaign of rumour and innuendo undertaken against the companies since early January 2018, when the short-selling of the company’s shares became evident.”

The JSE stated that its market regulation division had been reviewing trading in the shares of the Resilient stable since early January due to the volatility of its share prices.

The exchange said it would be taking the contents of the report and any further statements made by the Resilient group on the report into account in its review of the trading in the group’s shares.

Resilient CEO Des de Beer told Moneyweb on Friday that the company would be comprehensively responding to the report early next week.

Cy Jacobs, founder of 36One, confirmed to Moneyweb that an older version of its internal research on the Resilient group that wasn’t intended for publication had been leaked.

The company is investigating how this occurred. Jacobs stressed that investors shouldn’t rely on the report to make decisions as to whether they should buy or sell the shares.