MGP Ingredients falls as short-seller Spruce Point targets liquor maker

MGP Ingredients

12/10/2022 15:29

** Shares of distilled spirits producer MGP Ingredients Inc
 MGPI.O  slip ~3% to $98.63 - its lowest in three months
    ** Short-seller Spruce Point Capital Management issues
'strong sell' rating on co, sees downside risk of 35%-55%
    ** Merger with Luxco is failing, with many of the purported
benefits not having materialized even 18 months after the deal
has closed - Spruce Point 
    ** Also alleges there are multiple signs that co misstated
financial results, warns against "undue reliance on CEO David
Colo’s generally optimistic statements"
    ** Tough economic environment has prompted the consumer
shift away from premium liquor brands to value brands, a trend
that MGPI has recently "dismissed", the short seller says
    ** MGPI did not immediately respond to a Reuters request for
comment
    ** On Refinitiv, 7 brokerages rate MGPI 'buy' or higher;
with a median PT is $125 
    ** Including session moves, stock has risen 16% YTD
 (Reporting by Anirban Chakroborti in Bengaluru)
 ((Anirban.Chakroborti@thomsonreuters.com;))