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Nuvei says short-seller report that prompted share plunge 'intentionally misleading'

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MONTREAL — Nuvei Corp. has accused short-seller Spruce Point Capital Management of being "intentionally misleading" by issuing a critical report that caused its shares to plunge 40 per cent on Wednesday.

The Montreal-based tech company said after markets closed that the report features inaccurate conclusions, innuendo and character attacks on key executives.

It also reaffirmed its full-year and long-term growth targets.

"The personal attacks on Nuvei executives made by the short seller appear to have been made to distract from the company's achievements and progress," it stated in a news release.

"The short seller admits that it stands to profit significantly from Nuvei’s stock price decline, at the expense of Nuvei’s shareholders, customers and employees."

Nuvei shares were down 40.4 per cent or $49.61 at $73.12 at the close of trading on the Toronto Stock Exchange after falling as low as $54.47 earlier in the day. 

Spruce Point raised concerns about Nuvei chief executive Philip Fayer and the company's growth record and acquisition strategy. It suggested shares in the payment processing company faced a 40 to 60 per cent long-term downside risk.

Spruce Point said it has a short position in Nuvei and owns derivative securities that stand to benefit if its share price falls. 

The company closed the Toronto Stock Exchange's largest initial public offering in the technology sector last year.

This report by The Canadian Press was first published Dec. 8, 2021.

Companies in this story: (TSX:NVEI)

The Canadian Press