(The following is a statement issued by Muddy Waters on its
Report on Olam International Limited
Muddy Waters Reaction to Olam Frantic Response
Published: November 20, 2012
To Olam CEO Sunny Verghese and the Board of Directors: 
In the two and one-half years Muddy Waters, LLC has been openly
criticizing publicly-traded companies, we have not seen a
response as defensive as yours - not even from Sino-Forest. On
Monday, our Director of Research gave a brief talk on Olam at a
well-respected charity event. He presented facts about Olam
along with Muddy Waters’s opinion that Olam is at risk of
collapsing due multiple factors, including its debt load. As
Olam has since said, his comments were not overly substantive.
But based on this alone, Olam halted its stock, scheduled two
conference calls, discussed buying back shares, and issued
statements that included saying it is not a “fly-by-night
company”. It has further evidenced a bizarre fixation on
baseball caps. 
Olam’s disproportionate reaction is extraordinary in our
experience. Should Olam come to collapse (as we believe it will),
its use of much-needed cash to buy back shares at this time
should give rise to questions about whether fiduciary
responsibilities have been breached - particularly given the
possible existence of individual motivations that are not
necessarily aligned with those of Olam’s lenders. We also note
Olam’s attempts to impugn our credibility. 
You and your investors should note that attempting to silence
critics is not a plan of corrective action. In no way does it
make Olam stronger. The February 2011 CLSA report, which raised
far fewer concerns than we have identified internally, and that
Olam itself made so controversial, should have caused you to
work toward repairing what ails your business and your balance
sheet. Instead, Olam has since increased its a) debt load by
approximately S$900 million, b) cumulative investment cash burn
by approximately S$2 billion, and c) cumulative operating cash
burn by approximately S$500 million. In other words, you did the
exact opposite of what you should have done. Your actions have
been an abject failure of leadership. 
Companies that attack criticism the way Olam does fail to
understand that raising money from the public is a privilege.
Because Olam has received significant investment from the
government of Singapore, Olam’s mismanagement of the public
trust is that much less forgivable. Know this: You voluntarily
came to the market, you subjected yourselves to its forces, and
you must bear the consequences of your ineptitude. 
We do not work for an investment bank, and cannot be bullied the
way other analysts can. Our research into Olam has been
exhaustive, and we plan to resolutely stand by it regardless of
any attempts you might make to discredit it or us. 
We therefore suggest you find better uses of your time than
focusing on criticism. For instance, you might want to work on
plans to reign in your CapEx and de-leverage. The clock is
likely ticking. 
Warmest Regards,
Muddy Waters, LLC 
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