Temenos hits back at Hindenburg Report, appoints new CEO

In mid-February of this year Payments Cards & Mobile reported on a major bust up between Hindenburg Research, a prominent investor in Temenos.

Temenos hits back at Hindenburg Report

At the time, Temenos hit out at Hindenburg Research’s claims that there are “major accounting irregularities, failed products and an illusive turnaround” at the firm, but the damage was done and it caused the stock price to plunge 28% and for a number of clients to slow their appointment and roll out of Temenos software and services.

Now, Temenos has announced the completion of the independent examination into the allegations made by Hindenburg Research on February 15, 2024.

The examination was conducted by a Special Committee formed by Temenos’ Board of Directors (the ‘Board’) led by the Non-Executive Chairman, Thibault de Tersant.

The Special Committee was assisted by Schellenberg Wittmer Ltd, Sullivan & Cromwell LLP, and forensic accountants from Alvarez & Marsal Switzerland LLC.

The Independent Examiners were granted unrestricted access to company executives, personnel, records, communications, and all relevant documents.

Their review analysed the allegations made by Hindenburg Research, including Temenos’ compliance with applicable accounting standards and regulations, its strategic partnerships, its license renewal practices, the success of its products, its client relationships, and stock buybacks.

Report Findings

Their findings are based on a review of more than 300,000 documents and electronic communications, and interviews of 17 current and former Temenos employees, including senior management.

In total, over 150 attorney and forensic accounting professionals have spent over 22,000 hours investigating the allegations.

Based on this thorough independent external review, the Special Committee has determined that Hindenburg Research made incorrect and misleading allegations about Temenos and its accounting, products and customer relationships and presented purported facts about Temenos in a distorted manner or out of context.

“At the outset, we note that Hindenburg is not an independent or unbiased party,” says the report.

“It admitted that it held a short position in Temenos stock at the time it published its allegations and thus stands to profit from the stock’s decline.

Hindenburg’s allegations rely extensively on unnamed sources. It is not clear what questions these sources were asked, whether or to what extent they had direct knowledge of the subjects referenced, what else they said, and when the interviews took place.”

The findings of the independent examination have been presented to the full Board.

Neither the Board, nor its audit committee consider that the findings have any impact on Temenos’ previously published financial statements or change their belief that those financial statements fairly represent Temenos’ financial position, results of operations, and cash flows.

“I am pleased that the Independent Examiners have completed their review with the full cooperation and transparency from employees across the business,” comments Thibault de Tersant, Chairman of Temenos.

“The report has found that Hindenburg’s Research’s allegations were inaccurate and misleading. It clearly reinforces the Board’s view that Temenos is running a sound business, offering best in class products and has robust financial controls and strong governance oversight.

Temenos remains fully focused on servicing its clients and building relationships with its partners. The Board is confident that Temenos’ strategic plan and critical mass will allow it to continue to lead this market.”

Nonetheless, one of the casualties is the outgoing CEO, Andreas Andreades will retire from Temenos after 25 years of service. The appointment of Jean-Pierre Brulard as Chief Executive Officer of the Company, is effective on May 1, 2024.

Temenos stock has recover by ca. 20%


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