Lets get some news and follow up of Olam......
DJ - Olam Claims Sound Business Model
- Olam International Ltd. Wednesday shot back with a 45-page rebuttal of a research report by Muddy Waters LLC and said it faces no risk of insolvency.
- Olam has "sufficient liquidity" to fund its current business as well as future investment plans, the company said in a statement to Singapore Exchange, rejecting claims by short seller Carson Block and his firm Muddy Waters that the commodities supplier is running a risk of failure.
- Olam reiterated that its accounting practices "strictly" adhere to Singapore's rules and defended its business model and acquisition strategy.
"We would like to reiterate our position that the conclusions drawn in the (Muddy Waters') report are without merit," Olam said in the statement.
In a 133-page report released Tuesday, Muddy Waters said Olam may need to raise or refinance as much as 4.6 billion Singapore dollars (US$3.8 billion) in debt over the next year in order to stay solvent. The report also said that Olam has been "aggressive" in its accounting.
DJ MARKET TALK: Olam's Shares Likely To Remain Volatile - OCBC
0150 GMT [Dow Jones] STOCK CALL:
OCBC expects Olam's (O32.SG) stock to remain volatile until the company can provide a more substantial response to specific issues raised by short seller Muddy Waters in its report.
(The report accuses the commodities trader of a litany of failures, ranging from incompetence to malfeasance; Olam strongly denied the allegations, saying "there is no substance" in the assertions.)
"While Olam has reiterated that its accounting practices are fully compliant with international accounting stands, we do not expect the market to be pacified by this brief statement, especially since the allegations made by Muddy Waters were quite specific and relate to Olam's acquisitions, capex, and changes in accounting entries between the unaudited financial statements and its annual reports."
The house is still reviewing its Hold call and S$1.80 fair value. Olam's stock is halted; it last changed hands at S$1.56.
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