The 3 Cs of defending a siege from short-sellers

IN RECENT months, commodities supply chain manager Noble Group Limited has found itself the target of short-selling research firms. Noble's woes began in February this year with anonymous blogger Iceberg Research publishing a three-part report alleging, among other things, that Noble had "exploit(ed) the accounting treatment of its associates to avoid large impairments and fabricate profit". Short-seller Muddy Waters joined the fray in April, issuing its own report while concurrently making public its short-sell position on Noble shares.

This is not the first time that companies listed on the Singapore Exchange (SGX) have been under siege from short-sellers - Olam International and China Minzhong Food Corp were involved in similar high-profile incidents. In Noble's case, the short-sellers' reports have had a direct and sustained impact on Noble's share prices, which dropped from S$1.20 in February to below S$0.47 on Aug…