September 19, 2011 / 12:27 PM / 7 years ago

UPDATE 1-Silvercorp CEO boosts stake in company further

* Silvercorp CEO buys a further 135,000 shares in miner

* Co shares up 1 pct in pre-market trade in the U.S. (Adds background, details on share repurchase; share price move)

By Euan Rocha

TORONTO, Sept 19 (Reuters) - Rui Feng, the chief executive of embattled miner Silvercorp (SVM.TO), has boosted his stake in the company further, according to regulatory filings that indicate his vote of confidence in his own firm.

Feng, who early this month bought 100,000 Silvercorp shares in the open market, has bought a further 135,000 shares, taking his stake in the China-focused miner up to 3.99 million shares, the filings show.

Silvercorp, which operates silver mines in China, is the latest in a string of companies to come under short-seller attack. Complaints center around murky finances, or items in corporate filings that the short-sellers say cannot be substantiated. [ID:nS1E78D0YV]

Silvercorp has dismissed the anonymous allegations of fraud and accused short-sellers of attempting to run a “short and distort” scheme designed to drive down its share price.

The company has also been buying back shares under a program that its board approved in June, arguing that they are undervalued after the company lost $1.5 billion in market value in the last five months. It has bought 4 million of its outstanding shares since June 17. [ID:nS1E78E0BZ]

Silvercorp last week issued a raft of figures on its tax payments, assay results and other details that it says disprove the short-seller allegations against it.

Since the allegations surfaced in early September, Feng has spent roughly C$1.7 million on Silvercorp shares.

Shares of Silvercorp, which touched an 19-month low of C$5.81 last week, have since pared some losses and were at C$6.90 early on Monday, up from Friday’s close of C$6.81. (Reporting by Euan Rocha; editing by Janet Guttsman)

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