CPI Property Group commences internal audit after short-seller report (updated)

Cpi Property SA

30/11/2023 22:49

(Adds details from CPI press release and background)
       Nov 30 (Reuters) - Luxembourg-based commercial landlord
CPI Property Group  O5G.DE  said on Thursday that it has
commenced an internal audit and engaged a law firm to review the
company's governance procedures, compliance policies, and
allegations raised by short seller Muddy Waters. 
    Short-selling hedge fund Muddy Waters last week disclosed
its bet against the credit of CPI Property Group sending a key
bond of the company to fall by the most on record. 
    Muddy Waters had said CPI PG's controlling shareholder,
Czech billionaire Radovan Vitek, had misstated the value of the
company. The report also said some income had been booked
against real estate properties that were in fact empty plots.  
    Responding to the short seller report, CPI said in a
statement on Thursday that it had never obscured its
relationship with Vitek or his family. The company has said it
believes Muddy Waters is "categorically wrong about CPIPG." 
    CPI Property Group, which owns properties in Central and
Eastern Europe, said on Thursday that it is in discussions about
potential sales of minority stakes in portfolios located in
Poland and Germany. 
    CPI reported total revenue of 1.3 billion euros for the nine
months ended September 2023. It also registered adjusted EBIDTA
of 604 million euros for the period. 
    The company also said that the timing of the short seller
report was "unpleasant", adding it does not have any relation to
the resignation of its Chief Executive Martin Nemecek, which was
announced on Nov. 20, a day before the release of the report.  

 (Reporting by Akanksha Khushi and Jose Joseph in Bengaluru;
Editing by Daniel Wallis)
 ((Akanksha.Khushi@thomsonreuters.com;))