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Commodities firm Olam shares soar on fundraising plan | Commodities firm Olam shares soar on fundraising plan |
(32 minutes later) | |
Shares of Singapore-based commodities firm Olam International have climbed more than 8% on its plan to raise as much as $1.25bn (£770m) in fresh funds. | Shares of Singapore-based commodities firm Olam International have climbed more than 8% on its plan to raise as much as $1.25bn (£770m) in fresh funds. |
The move is the latest attempt by the firm to fight assertions by short-seller Muddy Waters that it is on the verge of collapse. | The move is the latest attempt by the firm to fight assertions by short-seller Muddy Waters that it is on the verge of collapse. |
Olam will offer $750m in bonds and up to $500m in warrants. | Olam will offer $750m in bonds and up to $500m in warrants. |
However, some analysts were still not optimistic and Maybank Eng downgraded Olam stock to 'sell' from 'hold'. | However, some analysts were still not optimistic and Maybank Eng downgraded Olam stock to 'sell' from 'hold'. |
In November Muddy Waters issued a 133-page report alleging questionable accounting practises at Olam that were masking high debt levels. | |
It claimed that some of the practices being followed by Olam were similar to those of Enron, before it collapsed. | |
Olam fiercely refuted the claims saying it was not at risk of insolvency and had enough liquidity. It also sued Muddy Waters in the Singapore High court. | |
Late on Monday, Olam announced its fundraising plan saying Singapore state investor Temasek Holding, already Olam's second-largest shareholder, would buy any rights not taken up by other investors. |
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