Silvercorp Metals Inc. (TSX: T.SVM, Stock Forum) (NYSE: SVM, Stock Forum) said Friday it has posted on its website an open letter from Chairman and CEO Rui Feng to shareholders of the company addressing class action suits.
The claims in the proposed class actions are based on false statements made in blogs published by internet blogger Jon Carnes, Feng said in the letter, which is also contained in a press release.
He went on to say that the proposed class actions do not rely on any new events or new facts; rather, they simply reiterate the same false claims put forward by self-interested short sellers who intended to manipulate Silvercorp’s share price and harm the company and its shareholders.
As reported by Stockhouse, Silvercorp is facing allegations that it violated U.S. Federal Securities laws by overstating the quality and quantity of its ore reserves at its Ying mine in China.
“When the truth regarding the quantity and quality of Silvercorp’s minerals production was disclosed, Silvercorp’s stock price fell, damaging investors, the suit alleges.
Closing at $4.24 on Friday, Silvercorp has a market cap of $724 million, based on 170.7 million shares outstanding. The 52-week range is $8.45 and $4.02.