Temenos shares surged by 20% on Monday after an independent review into allegations made by Hindenburg Research said the short-seller’s claims were “inaccurate and misleading.”
The review –- which was carried out by lawyers and accountants from Schellenberg Wittmer, Sullivan & Cromwell, and Alvarez & Marsal Switzerland –- said Hindenburg Research made misleading claims in its report that crashed Temenos’ share price by more than 30% in February.
Hindenburg’s report, published on Feb. 15, accused Temenos of using “aggressive accounting tactics” to boost its share price and gloss over deeper problems inside the Geneva headquartered firm which sells software to banks and financial institutions.
The independent examination, however, found no evidence to support Hindenburg’s claims, as it instead said the short-seller had “presented purported ‘facts’ in a distorted manner,” having already taken out a short position in the Swiss firm prior to publishing its allegations.
“We have determined that Hindenburg made a series of inaccurate and
misleading allegations about Temenos and its accounting, products, and client relationships,” said the report.
Shares in Temenos TEMN, +21.34% increased 20% on Monday, having previously lost 31% of their value following publication of Hindenburg’s, knocking more $ 2 billion off the Swiss firm’s market capitalization.
In a statement, Temenos said it gave “unrestricted access” to its accounts to over 150 accountants and lawyers, who spent a combined 22,000 hours analyzing 300,000 documents and interviewing 17 current and former executives, in their investigation into Hindenburg’s allegations.
Temenos’ board of executives and auditor, PwC, both subsequently said their opinion of the Swiss firm’s financial statements –- that were questioned by Hindenburg in a series of reports –- remained unchanged, on being presented with the independent examination’s findings.
Hindenburg Research was approached by MarketWatch for comment.