Singapore's Olam initiates legal action against Muddy Waters

Singapore-based commodities supplier Olam International has initiated a legal action against U. S.-based short seller Muddy Waters Research and its founder Carson Block, local media reported on Thursday. The legal action was initiated in the High Court of Singapore on Wednesday against both Muddy Waters and Block for "the statements made at the Sohn London Investment Conference in London, " the company said in a statement issued on Wednesday evening. Carson Block questioned the debt levels and accounting practices of Olam International at the investment conference on Monday, saying he was betting against Olam International. The comments triggered a sharp fall in the share price of Olam International in the United States over-the-counter market later on Monday and on the Singapore bourse on the following day, though the stock had recovered most of its loss by market close on Wednesday after the company defended itself vigorously. All its statements had been audited by Ernst and Young, it said. Olam International, a large commodities supplier that is one of the largest firms listed in Singapore and the first Singapore company targeted by Muddy Waters Research, said on Tuesday that it reserves the right to take strong and appropriate action. Block issued an open letter to Verghese and Olam's board on Wednesday, saying that the reaction of Olam was disproportionate and extraordinary, and that investors should note that "attempting to silence critics is not a plan of corrective action."