We Listen to Our Fiercest Critics: Olam CEO
The CEO of Singapore-based agricultural commodities firm Olam International, which was targeted by short seller Muddy Waters late last year, told CNBC the firm has listened to its fiercest critics as it plans to slash capital spending and downsizes its profit expectations.
"We are a company that listens to our stakeholders. And I think that is something that we all really like about our company. And we listen to both our fiercest critics and our most ardent advocates," CEO Sunny Verghese told CNBC's "Asia Squawk Box," on Friday.
In November last year short seller and research firm Muddy Waters questioned Olam's accounting practices. Its founder Carson Block cast doubt over the way Olam, that is partly owned by Singapore state investor Temasek Holding, booked profits on its acquisitions as well as its valuations of its plantations, crops and livestock.
This led to a sharp fall in the Singapore-listed company's share price, which fell about 15 percent in the month following Muddy Waters' claims.
On Thursday, Olam announced that it would halve its capital spending over the next three years and sell some of its businesses. It also said it was aiming to be free cash-flow positive by the year to June 2014, one year earlier than previously forecast, and delayed a target of reaching $1 billion in net profit by 2016, Reuters reported.
As a result of these announcements the trading firm's shares were up as much as 3 percent in early Friday trade.
"We are pursuing various opportunities to unlock intrinsic value in the various assets that we have assembled and built over the last several years," said Verghese adding, ""We are now giving investment information of how our investments are performing. That will allow our analysts and shareholders to make their own determinations about what our future prospects are."
Reacting to Olam's new plan, Muddy Waters said in a statement: "Olam is now saying the right things, and one hopes they're sincere; however, we question whether this is too little, too late given Olam's existing debt load and asset quality."
(Read More: Temasek says comfortable with Olam's credit, prospects)