Olam bears 'similarities' to Enron: Muddy Waters
Short-seller research firm Muddy Waters said commodities trader Olam International was similar in some ways to failed US firm Enron in a scathing 133-page report released today.
In the long-awaited report, Muddy Waters wrote that Olam's "asset heavy" strategy "appears to be an off-the-rails capex and acquisition binge", and claimed that Olam's projects were "marred by incompetence and perhaps significant misconduct".
"We believe it is instructive to view Olam through the lens of failed US trader Enron Corp. There are a number of material similarities in the way their businesses developed, and their action."
It has been about a week since the research outfit first raised questions over Olam's accounting practices, which happened last Monday.