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UPDATE 2-Fullshare jumps 17 pct after it dismisses short-seller claims
May 4, 2017 / 1:50 AM / 4 months ago

UPDATE 2-Fullshare jumps 17 pct after it dismisses short-seller claims

* Glaucus Research accused co of stock manipulation

* Claims are "misleading and groundless": Fullshare

* Short-seller Dan David also says co's accounts are suspect (Adds details of new short-seller in par 7, updates stock price)

HONG KONG, May 4 (Reuters) - Shares of Hong Kong-listed property and healthcare group Fullshare Holdings Ltd jumped as much as 17 percent on Thursday after it rejected allegations by a U.S.-based shortseller about its financial health.

Shortseller Glaucus Research, in a report last week, had queried Fullshare's stock trading patterns, its valuation and asset disposals. The report said Fullshare was "one of the largest stock manipulation schemes trading on any exchange anywhere in the world".

Fullshare said in a statement to the Hong Kong stock exchange late on Tuesday the allegations, which had caused its shares to plunge last week, were "misleading and groundless" and it was consulting legal advisers.

Shares of Fullshare surged as much as 16.7 percent early on Thursday to HK$2.94, recouping all of the losses it incurred following the Glaucus report. The stock was up nearly 15 percent at the lunch break, outpacing a 0.5 percent drop for the benchmark Hang SEng Index.

The company halted trading last week after its shares plunged nearly 12 percent following Glaucus' allegations.

Glaucus said in another statement on Thursday that Fullshare's response was totally inadequate and failed to present any meaningful rebuttal to its allegations.

The company came under further scrutiny on Thursday when short-seller Dan David of FG Alpha and GeoInvesting issued a report saying Fullshare was "creating an accounting scheme that's bound to eventually implode".

FG Alpha and GeoInvesting were wrapping up months of on-the-ground due diligence when Glaucus issued its report, David said, adding that he believed Fullshare "is a completely uninvestable stock".

Fullshare could not immediately be reached to comment.

On Wednesday, Fullshare said in a separate statement that China CITIC Bank Corp had agreed to provide it with credit of not less than 10 billion yuan ($1.45 billion).

$1 = 6.8970 Chinese yuan renminbi Reporting by Anne Marie Roantree; Editing by Stephen Coates

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