(Reuters) - The board of GFL Environmental Inc GFL.TO on Tuesday rebuked a report by short seller Spruce Point that claimed the Canadian waste management company has understated its cash burn and debt, and backed its management.
Spruce Point said last week that GFL's shares were "worthless" as the company has downplayed its free cash flow burn by about 60%, and its debt figure was off by at least C$460 million. (bit.ly/2QlPhAH)
GFL said on Tuesday it found the allegations “deeply flawed”, following a review and discussions with the company’s external auditors and other advisers. Its shares have fallen more than 12% since Aug. 17 - the trading day before the report was published.
“Spruce Point Capital’s report and related public commentary are consistent with a ‘short and distort’ strategy for the benefit of Spruce Point,” GFL said in a statement.
The GFL board of directors stands 100% behind the company’s management team, said Dino Chiesa, GFL board lead independent director, adding GFL’s financial disclosures were accurate.
Reporting by Ankit Ajmera in Bengaluru; Editing by Shinjini Ganguli
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