* Muddy Waters criticised Casino in Dec. 2015
* AMF in midst of formal probe into matter -source
* Probe likely to last few more months -source
(Adds details and background)
By Dominique Vidalon and Matthieu Protard
PARIS, Nov 30 France's AMF stock market watchdog
is in the midst of a formal investigation into criticism made by
U.S. research firm Muddy Waters against French retailer Casino
which should last a few more months, said a source
close to the matter.
"The probe has been under way since the start of the year.
The AMF is conducting in-depth investigations on a complex
matter. It implies checking the communication of the two
protagonists in the case and assessing whether there has been a
violation or not," the source told Reuters on Wednesday.
Officials at Muddy Waters could not be immediately reached
In December 2015, Muddy Waters criticised Casino's
accounting practices, saying the supermarket retailer was
"dangerously leveraged" and managed for the short-term,
prompting the worst slide in seven years in Casino's stock
Muddy Waters said at the time that it was "short" on
Casino's shares and credit, namely betting on falls in both
Casino has rejected Muddy Waters' criticism and, having
raised the issue with the AMF, said it reserved the right to
take legal action.
In January 2016, the AMF said it would look closely at
information provided by Casino and Muddy Waters to see whether
the U.S. short-seller and research firm had overstepped the mark
when it published its December critique into Casino.
However, the AMF did not say at the time if it had launched
an actual formal investigation into the matter.
An AMF investigation usually takes about a year but some
probes can take longer due to their complexity and because they
require international cooperation.
Casino, which saw its credit rating cut to junk status by
Standard & Poor's in March, has been selling assets to cut debt
while improving its performance in France and simplifying its
complex group structure.
Shares in Casino are up by around 1 percent so far in 2016,
having slumped around 45 percent in 2015.
(Reporting by Dominique Vidalon; Editing by Jean-Michel Belot
and Sudip Kar-Gupta)