New Oriental says short seller's allegations lacked evidence

Oct 1 (Reuters) - New Oriental Education & Technology GroupInc said its investigation did not find any"significant" evidence to support certain allegations raised byshort-seller Muddy Waters.

Carson Block's Muddy Waters in July alleged that theeducation provider had lied about its entire store network beingcompany owned and the franchise fees were used to inflate itscash balances.

China-based New Oriental had rejected the allegations then,before proceeding to set up a special committee to investigatethe matter.

The committee comprised the company's three independentdirectors, New Oriental said.

New Oriental shares, which have gained 16 percent since theallegations were made on July 18, were up 5 percent in morningtrading on the New York Stock Exchange.

(Reporting by Bijoy Koyitty in Bangalore)

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Keywords: NEWORIENTALEDUCATION/