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  • shuka_e shuka_e Feb 8, 2013 8:40 AM Flag

    Why the company was delisted, and why they don't publish the Financial Reports?

    In order to answer these questions we have to go back in time
    The delisting came after the resignation of KMPG and the withdrawal of their approval from the financial reports. This occurred because of the resignation of the first Independent Committee.

    On April 21, the Chairman of the Audit Committee resigned.

    On the same day the SEC halted the trade.

    A glance at the SEC generated letter from 13/05/2013 to the company, that can be be found in the company's site, shows that the withdrawal of the approval from the financial reports, was the reason and only reason for the delisting.

    Except of the allegations of A*L there is nothing that proves that the company is a fraud, on the contrary, the new committee found that the vast majority of the allegations were baseless, and I quote:

    " In May 2011, the Audit Committee engaged Shearman & Sterling LLP to lead the independent investigation into these allegations. Each of these allegations was thoroughly investigated. While some issues remain as to production at the Company's Tongchuan biodiesel facility, and while the investigation revealed the need to strengthen internal controls and take similar measures, the primary substance of all other allegations has been proven groundless. Sales of biodiesel accounted for approximately 17% of the Company's revenue in FY2010. The Committee applauded the Company for its full cooperation given throughout the investigation."

    Think, if you were instead of the chairman and the owner of the company, would you act differently?
    If I were instead of him I would have done everything within my power in order to cause maximum damage to the short sellers, and I would not have given them the slightest information about the company.
    I am not happy with the situation and I think that the company should do more in order to calm the investors, but we have to remember, that they have limitation to such letters, because of the very large opened shorts sales. If I were instead of the owner, I would have done every thing within my power in order to burn the short-sellers, and this can be done by one time unexpected excellent PR.
    May be I am deluding myself but I am ready to wait until the hearing in court will be resolved.

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