By Eric Jackson
In March, I traveled with my colleagues to the headquarters of Orient Paper
as part of due diligence trip on several Chinese-based, U.S.-listed companies. Coming back from the trip, and after doing more research, I invested in Orient Paper and I wrote several favorable articles on the company, articulating the case for why I thought it was under-valued.
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Earlier this week, a new "research" company called Muddy Waters published its first report in which it alleged that Orient Paper is a fraud and assigned a price target of less than $1. They suggested the company had misappropriated private placement funds from investors, cooked the books and prevented them from doing their studious due diligence on site. It's had a disastrous impact on thestock price of ONP. Earlier this week, before the report came out, the stock was trading at close to $9. Yesterday, at the height of panicked selling, the stock touched $4.11.
|The writer (left) with CEO Zhenyong Liu (center) and my colleauge Chris Lau.|