Olam shares slip nearly 7 pct, erase gains that followed rights issue

SINGAPORE Dec 5 (Reuters) - Shares of Olam International Ltd fell sharply on Wednesday as concerns persisted about the Singapore commodities firm's financial position despite a rights issue backed by state investor Temasek Holdings Pte Ltd.

Olam shares declined as much as 6.9 percent on Wednesday, more than wiping out gains the previous day after the company announced a $1.2 billion bonds-with-warrants issue.

Olam has been battling Muddy Waters for two weeks, after the short-seller attacked the company's accounting, debt and investment projects. (Reporting by Eveline Danubrata; Editing by Edmund Klamann)