Argentine Farmland Owner Says Short-Seller Report Misleading

  • Cresud, IRSA say financial reports have been properly audited
  • Cresud says Spruce Point is seeking to profit on report

Cresud SACIF y A, Argentina’s largest publicly-traded owner of farmland, said a report from short-seller Spruce Point Capital Management calling the company overvalued is “misleading” and “unfounded.”

The short seller is trying to profit off speculative investments and the report is “full of inaccurate references and inappropriate insinuations,” Cresud said Friday in a regulatory filing.

“We stand by the accuracy and integrity of our financial statements which were audited by an internationally recognized external accountant firm,” Cresud President Eduardo Elsztain said in the statement.

Cresud’s American depositary receipts fell 7.9 percent to $11.02 at 11:05 a.m. in New York after having tumbled the most in three months Thursday on the Spruce report.

The company, whose farmland holdings cover an area larger than Rhode Island, could drop to as low as $4.75 in New York trading, the report said. That would represent a 60 percent plunge from current levels.

Israeli Investment

Cresud and its subsidiary IRSA Inversiones y Representaciones are “burdened” with $6.7 billion of debt after “IRSA recently invested approximately $300 million in IDB Development Corp.,” the Spruce Point report said. Dolphin Funds, a firm controlled by IRSA, owns 49 percent of IDBD, according to data compiled by Bloomberg. Israeli-holding company IDBD has interests in real estate, communications, agricultural products, insurance and technology.

In August, Spruce Point targeted Caesarstone Sdot Yam Ltd., an Israeli maker of quartz countertops, arguing the company was overvalued and causing shares to fall as much as 17 percent.

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