UPDATE 3-Muddy Waters' Block targets HK-listed Superb Summit; shares slide

Thu Nov 20, 2014 6:28am EST
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* Muddy Waters questions value of company's forest assets

* Superb Summit is latest Chinese firm targeted by short-sellers

* Shares in Superb Summit fall 6 pct before trading halt (Adds manager of independent valuation firm, short-selling data)

By Nishant Kumar and Anne Marie Roantree

LONDON/HONG KONG, Nov 20 (Reuters) - Investment research firm Muddy Waters, whose negative reports have decimated shares of Chinese companies listed overseas, has questioned the balance sheet of timber firm Superb Summit International Group , hitting its stock on Thursday.

The allegations, which coincide with the launch this week of a tie-up between the Hong Kong and Shanghai stock exchanges that gives global investors greater access to Chinese stocks, come after a string of corporate scandals that underscore the perils of doing business in the world's second biggest economy.

A report from Muddy Waters founder Carson Block, a short-seller who has exposed accounting problems at a slew of Chinese firms, questioned the value of the assets owned by Superb Summit.

Block questioned in particular forestry assets in China that the timber company valued at HK$3.35 billion ($432 million) in its first-half results.

Superb Summit, which is worth $1.6 billion on the Hong Kong stock exchange, declined to comment.   Continued...