In December of last year, Tecnoglass (NASD: TGLS) shares plunged over 40% on NASDAQ after a report was released by short seller Hindenburg Research. Short selling is a practice where a speculator borrows shares in a company and then hopes (or tries to make) the value of those shares fall significantly. The short seller then buys the now cheaper shares at a low price returning them to make good on the loan, but profiting in the difference between the original share price and the now depleted share price. While many consider short selling unethical when tied to practices designed to manipulate the stock price, it is not always illegal.
On December 17, 2021 a Special Committee of the Board of Directors engaged Covington & Burling LLP who in turn engaged a leading Big 4 accounting firm to make an assessment on the allegations made against Tecnoglass by Hindenburg Research.
Yesterday, Tecnoglass issued a statement on the investigation done so far by Covington & Burling, and the forensic accountants.
Tecnoglass, Inc. (NASDAQ: TGLS) (“Tecnoglass” or the “Company”), as disclosed yesterday, the work of a Special Committee of the Board that was formed to assess the allegations in a short seller report issued on December 9, 2021 is nearing completion. Consistent with the allegations in the short seller report, the Special Committee’s mandate was to (1) investigate whether transactions with certain related parties were not properly disclosed, (2) identify and consider the controls associated with related party transactions, and (3) assess the veracity of allegations in the short seller report of past law enforcement activity involving certain Tecnoglass officers. While the Special Committee has been focused only on the issues outlined above and its work is nearing completion, the Special Committee has not, during the course of its work, identified evidence of fraud associated with the related-party transactions referenced in the short seller report. The Company does not expect that the findings from the Special Committee’s review will result in an adverse effect on the Company’s consolidated financial statements, results of operations, or liquidity, in each case for the fiscal year ended December 31, 2021.
Tecnoglass to participate in today’s Raymond James 43rd Annual Institutional Investors Conference
The manufacturer also announced that it will attend the Raymond James 43rd Annual Institutional Investors Conference in Orlando, Florida, taking place today, Tuesday, March 8, 2022.