Temasek investment in Olam Group

1. Muddy Waters is a well-known investment research and management firm. In 2012, Muddy Waters released a report on Olam International, a multinational agri-business company. The report claimed that Olam had overstated its assets and profits, and that it was headed for a debt crisis.

Following the release of the report, Olam’s stock price plummeted, leading to significant financial losses for shareholders. Olam vehemently disputed Muddy Waters’ claims, calling them false and misleading. The company launched a legal challenge against Muddy Waters in Singapore, but the case was later dismissed.
Overall, the Muddy Waters report on Olam sparked a heated debate in the investment community, and brought attention to the issue of corporate transparency in the agri-business sector.

2. The 2012 Muddy Waters report on Olam International was a comprehensive analysis of the company’s financial statements and business practices. The report raised several concerns about Olam’s accounting practices and its ability to repay its debts.

The key points of the report include:
* Overstated profits: Muddy Waters claimed that Olam had overstated its profits and understated its losses.
* Inflated asset values: The report alleged that Olam had overstated the value of its assets, including its inventory and fixed assets.
* Debt concerns: Muddy Waters argued that Olam had taken on too much debt, and that its debt-to-equity ratio was unsustainable.
* Poor corporate governance: The report also raised concerns about Olam’s corporate governance practices, including its relationships with suppliers and customers.

Muddy Waters concluded that Olam was a “fraud” and that its stock price was overvalued. The report was released in November 2012, and caused a significant decline in Olam’s stock price. Olam vehemently disputed the report’s claims and launched a legal challenge against Muddy Waters in Singapore.

3. Temasek Holdings, a Singaporean sovereign wealth fund, defended Olam International after the Muddy Waters report was released in 2012. Temasek, which is a major shareholder in Olam, publicly stated that it had full confidence in the company’s management and financials, and called the Muddy Waters report “baseless and unfounded”.

Temasek also supported Olam in its legal challenge against Muddy Waters in Singapore, which was later dismissed. Through its support, Temasek demonstrated its commitment to Olam and its belief in the company’s ability to overcome the challenges posed by the Muddy Waters report.

Overall, Temasek’s defense of Olam helped to alleviate some of the concerns raised by the Muddy Waters report, and helped to restore investor confidence in the company.

4. Above is the price chart of Olam as at 31 Jan 2023. After Temasek supported Olam in 2012, the stock price continued to decline but moderately. The stock did not recover.


Tan Kin Lian




12 Responses to “Temasek investment in Olam Group”

  • Ching Ho:

    So the truth………between the DEVIL and the RBS?

    Ching Ho!

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  • MarBowling:

    Everything and Anything Holee Jinx touches, DIE! O-LamPAR is LPPL!

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  • Crimes committed?:

    Sounds like crimes were committed.
    Inflated profit, inflated circulation, …

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  • ah seng:

    I think the family also invested in Olam, Capitaland also, this is why they would go all the way out to dispute.

    Capitaland with 100s of malls in China probably under water, no one dared to ask in parliament…. Remember we are number 1 investor in China and India.

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  • Curious:

    Why companies like Olam and Adani lost some much values when attacked by such Research companies ?
    Maybe not so strong after all…?

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  • Trash:

    Again Temasek? Our useless 4G leaders will have no balls to handle this?

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  • xoxo:

    They have alot of talents,local and foreign at Tema$ick Hole-ding$.
    But,they only good at collecting more money from sinkingPOOReans.
    Time to assess the REAL KPI.
    CONNING is not part of KPI or is it?

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  • Temasek invest in Adani Group?:

    And as of today Singapore banks such as Bank of Singapore and DBS continue to load money to Adani?

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  • Light The Way:

    Olam International should have POFMAed Muddy Waters instead of going to court.

    This would have avoided the dismissal of their defamation lawsuit, further adding to the insult.

    Learn from the best or die like the rest.

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  • Will SG help Adani:

    I wonder will Modi ask SG government help Adani and if SG government will help?

    It seems Bank of Singapore and DBS not cutting off loans to Adani? Lesson should be learned from the Olam case.

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  • Brazil trouble, again.:

    August 12, 20216:03 AMUpdated a year ago
    Exclusive-Cocoa giant in Brazil slave labour probe says it can’t trace supplies

    RIO DE JANEIRO (Thomson Reuters Foundation) – One of the world’s top cocoa processors has told a Brazilian court investigating child and slave labor it cannot trace its supplies, contradicting its own public statements and raising fears exploitation may be going unchecked.

    Olam International is one of three food companies being sued by Brazilian state prosecutors for allegedly failing to address labor abuses in their supply chains.

    The company denies the charges, which stem from a 2018 report by Brazil’s Federal Labor Prosecution Office and the International Labor Organization that showed widespread use of child and slave labor in Brazil’s cocoa industry.

    But in its statement to the court in April, Olam’s lawyers said cocoa beans that were passed from farmer to middle man before being bought by the company were “not liable to tracking”.

    “You don’t know the origin, you can’t control the origin,” said the submission, given exclusively to the Thomson Reuters Foundation. “There is no way for the buyer of the commodity to know where it came from.”

    In contrast, Singapore-based Olam’s website offers its customers a guarantee that they can buy its chocolate knowing that “it has been produced in a way that supports the most vulnerable people and environments in the supply chain”.

    What a guarantee.

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  • Absurdity:

    Adani is another one. Anyone can put the stock losses at 141b or even 200b. The authorities can call it fake news and say ONLY 140b!

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