The Daily Observer London Desk: Reporter- Victoria Smith
Oilfield services group Petrofac is the most shorted company on the London Stock Exchange despite bagging a crucial £1.1 billion contract.
Hedge funds – which will make money if the company’s share price falls – have shorted almost 10 per cent of Petrofac’s stock.
The company was trading at record lows earlier this month after warning that it was in financial trouble and was exploring options – including selling off assets – to bolster its books.
Heading for a fall?: Hedge funds have shorted almost 10 per cent of Petrofac’s stock
It managed to secure a guarantee that will unlock an advance payment for a major contract with a Dutch customer, which sent its share price soaring.
The group has said it expects to post a smaller loss in the current financial year.
However, hedge funds appear to be sceptical about its longer-term prospects and have continued to make bets against the company.
