The Rural Funds Group (ASX: RFF) share price fell around 4% after it was targeted by Bonitas Research for a third time.
Rural Funds stated that a third document has been released today by Bonitas which Rural Funds said “was deliberately misleading and is again designed for Bonitas and those behind it to make financial gain, to the detriment of other RFF security holders. Rural Funds Management reiterates its statement from 8 August 2019, that no further detailed responses will be provided to any existing, or possible future, allegations made by Bonitas.”
The latest Bonitas comments allege that the Ernest & Young (EY) report did not give a clean bill of health and EY didn’t refute the allegations. Bonitas made further claims about incorrect accounting and tried to raise suspicions about farm valuation increases. Bonitas did state that it has received correspondence from a Texas law firm on behalf of Rural Funds which may be the start of a defamation lawsuit.
Rural Funds Management has advised its legal counsel about the matter and proceedings in the Supreme Court of New South Wales will commence soon. The findings of the Court will be used as the most authoritative response to the document released by Bonitas.
It was a month ago that Bonitas Research started its short attack against Rural Funds Group by making a number of claims about the farmland real estate investment trust (REIT) and Rural Funds Management.
On 27 August 2019, Rural Funds Management released a report by EY of their investigation into the matter and EY concluded that the claims were not substantiated.
Earlier today David Bryant bought another 252,418 units at $1.97 per unit, showing that management are confident in their words of defence and confident with the accounts.
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Motley Fool contributor Tristan Harrison owns shares of RURALFUNDS STAPLED. The Motley Fool Australia owns shares of and has recommended RURALFUNDS STAPLED. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.