Shares of Loop Industries (LOOP) – Get Report lost a third of their market value on Tuesday after the activist investment group Hindenburg published a report lambasting the plastics-recycling company and said it took a short position.
The investment firm said it interviewed former employees, competitors, industry experts and company partners as part of its investigation and concluded that Loop is “smoke and mirrors with no viable technology.”
Loop, Terrebonne, Quebec, didn’t immediately return a request for comment.
Former employees told Hindenburg that Loop operated two labs, one reserved for its “two twenty-something lead scientist brothers and their father” and one run by rank-and-file scientists who were unable to replicate results.
The investment firm said that a Loop employee told Hindenburg that scientists were pressured by Chief Executive Daniel Solomita to “lie about the results of the company’s process internally. We have obtained internal documents and photographs to