Commodity trader Olam battles Muddy Waters accounting claims

Singapore commodities trader Olam International Ltd defended its accounting practices after attacks by short-seller Muddy Waters which media reports said questioned the way it keeps its books, sending its U.S.-listed shares tumbling.

Singapore-listed shares in Olam, which is nearly 16 per cent-owned by state investor Temasek Holdings, were halted on Tuesday as the company accused Muddy Waters founder Carson Block of making “baseless and unsubstantiated assertions” against it.

Block questioned the way Olam had booked profits on some of its acquisitions as well as its valuation of its plantations, crops and livestock, the Financial Times reported.

“This is not a black box, this is a black hole,” the FT quoted Block as telling an investment conference in London on Monday. No comment was immediately available from Muddy Waters.

Temasek declined comment and directed all queries to Olam.

Started by the Kewalram Chanrai Group in Nigeria, Olam has grown into a diverse agricultural commodities trading company with interests ranging from cocoa and coffee to sugar and nuts.
Chief Executive Sunny Verghese has aggressively led the company’s expansion as it takes on larger commodity players such as Noble Group Ltd and Wilmar International Ltd .