Noble Group shares dive on crit­i­cal Muddy Wa­ters re­port

The China Post - - MARKETS -

Asian com­mod­ity trad­ing gi­ant Noble Group hit back Thurs­day af­ter U.S. short­seller Muddy Wa­ters ac­cused the firm of ex­ist­ing “solely to bor­row and burn cash,” in an attack that saw its shares dive.

It fol­lows ear­lier al­le­ga­tions of ir­reg­u­lar ac­count­ing prac­tices at the Hong Kong-based com­pany.

“The man­age­ment com­pletely re­jects the al­le­ga­tions,” Noble said in a brief state­ment to the Sin­ga­pore stock ex­change — where the com­pany is listed — re­spond­ing to the Muddy Wa­ters re­port.

The state­ment said the com­pany was “study­ing the re­port in de­tail.”

Noble share prices tum­bled on the Sin­ga­pore Ex­change, closing 5.5 per­cent lower at 86 Sin­ga­pore cents (64 U.S. cents) af­ter fall­ing by as much as 9.3 per­cent fol­low­ing Muddy Wa­ters’ dis­clo­sure that it was tak­ing a short po­si­tion on the com­pany.

Muddy Wa­ters de­scribed Noble as “com­plex and opaque” in its re­port.

“It be­comes a ques­tion of how much in­vestors should trust Noble’s man­age­ment to be straight with them,” it added.

A public re­la­tions of­fi­cer for Noble said he could make no fur­ther com­ment when con­tacted by AFP.

Muddy Wa­ters was also be­hind a 2012 attack on Sin­ga­pore-based farm com­modi­ties sup­plier Olam.

Olam’s shares prices tum­bled af­ter Muddy Wa­ters al­leged the com­pany was in dan­ger of in­sol­vency.

But Olam weath­ered the storm af­ter Sin­ga­pore’s pow­er­ful state in­vest­ment agency Te­masek Hold­ings backed the firm.

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