Samsonite, the world’s biggest luggage maker, has replaced its CEO Ramesh Tainwala after an activist investor accused him of lying about his academic background and proving wrong information. According to a report on South China Morning Post, the shares of the company slipped drastically after US short-seller Blue Orca Capital made that allegation and also accused Samsonite of “questionable accounting practices” and poor corporate governance.
However, the news of Tainwala's departure has made Samsonite's shares surge 12 percent on Friday, recovering virtually all the ground they lost due to the free-fall on May 24. Reportedly, he has falsely claimed to be a doctor, when he doesn't hold a doctorate degree. Tainwala resigned citing personal reasons.
Samsonite issued a 9-page response to other allegations made by Blue Orca, saying the report was one-sided and misleading. According to a Reuters report, analysts have appreciated the quick action from the company, but it is still to be seen, how soon Samsonite will be able to come out of the mess, which it has got into.