The Casino Groupe SA denied the allegations leveled at the French supermarket operator by short-selling firm Muddy Waters LLC in an extensive reply filed Monday to the French market regulator.
According to Archy Newsy, the Casino specified that the investigation report released by Muddy Waters a week ago is consist of many false and misleading allegations that are meant to undesirably change up the buying and selling prices of Casino's stock and debt, for the advantage of the report's author.
Market Watch stated that the U.S.-based firm last week criticized Casino's accounting practices. As stated in a report dated December 17, the French company was one of the most overrated and misinterpreted companies it had ever encountered. It also accused the mass retailer of using accounting tricks and financial engineering to pump up its earnings.
This serious report has ignited a higher stakes fight between Muddy Waters's founder Carson Block and Casino's controlling investor and Leader Jean-Charles Naouri. Mr. Block stated that Casino shares might be worth less than EUR6.91, while Casino Monday pointed for an analyst consensus share-cost target of EUR55.
As response to Muddy Waters, Casino stated that its business model, strategic plans and financial structure are strong. The group, whose operations cover France, parts of Europe and a number of developing economies, assured that it "strictly applies international accounting standards and the group's financial accounts are certified by its external auditors."
The Wall Street Journal noted that Casino has a solid business dynamics, earning helpful benefits from the recovery of their French business. Incomes from the huge commercial, real-estate business that were stated by Muddy Waters seemed to be accustomed to dope retail profits in France. This has been reflected in the results based on worldwide financial-confirming standards.
Another allegation of Muddy Waters stated that Casino's plan to lessen debt by more than €2 billion in 2016 is a hollow and desperate trick to buy time. The plan is reportedly completely dependable with its long-term tactic and would bring value to shareholders.
As of the moment these are the available facts about the controversial claims. More information are expected to arrive as the case continues.
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