China Minzhong says short-seller misunderstands its business model
SINGAPORE Aug 29 (Reuters) - Food producer China Minzhong Food Corp Ltd said on Thursday that the accounting issues raised by a short seller this week are not new and are based on a misunderstanding of its business model.
On Monday Glaucus Research published a 49 page report alleging Singapore-listed China Minzhong fabricated details about two of its biggest customers and overstated its revenues in its listing prospectus.
Shares in the food producer fell as much as 50.7 percent after the report was released on Monday before trading in the stock was suspended two hours later.
China Minzhong said it plans to issue a detailed response to the allegations.
"The company would seek to substantiate in its detailed response to the report that its financials are sound and that there were no fabricated sales or alleged cover up by the company," China Minzhong said in a statement.
The company said it has also delayed the publication of its full year results from Thursday morning to Thursday evening so that it has more time to address the issues raised by Glaucus.
California-based Glaucus disclosed that it had a short or indirect short position in the company. (Reporting by Rachel Armstrong; Editing by Edwina Gibbs)
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