Anta Sports denies Muddy Waters claimsBusiness | 9 Jul 2019 11:43 am
Mainland sports wear manufacturer Anta Sports (2020) said today it vigorously denies the allegation by US short-seller Muddy Waters that the company controlled of some of its major distributors to manipulate its reported financial information.
Anta Sports said the Muddy Water report is incorrect and misleading.
Among other things, Anta Sports said all of the group’s 25 distributors referred to in the Muddy Waters report are third parties independent of and not connected with the company or any of its connected persons.
Each distributor has its own management team who make independent business decisions, and has its own financial and human resources management functions independent from that of the group, with no control over one another, Anta Sports said.
The group regulates its relationship with its distributors through the distributorship agreements and relevant guidelines, which terms are substantially the same among all distributors, and did not have material changes in recent years.
The group adopts unified wholesale discount policy for all its distributors in the mainland and offer sales rebates to distributors in accordance with their retail management performance assessments commonly adopted in the industry. There is no sharing of management expenses between the group and its distributors, the company statement said.
As each of the distributors in most cases is the sole distributor to sell products within the designated geographical area specified in their respective distributorship agreement, the group would give more directions and maintains regular communication with them in sales and marketing strategies, market management and performance assessment systems. The distributors are responsible to make the final business decisions and take the gain or loss for their operations, the company said.