NQ Mobile Inc (ADR) (NYSE:NQ) announced on Tuesday that it was formally rejecting what some said was a suspicious non-binding go-private offer from Chinese firm Bison Capital. However, that press release also stated that NQ was still in talks with Bison about other “investment and collaboration” opportunities.

NQ Mobile
NQ Mobile Inc. NQ

Talent agency planning to dissolve

Earlier this month, Deadline.com reported that Resolution Talent Agency was shutting down because a Chinese firm that committed funds was backing out. That firm happens to be Bison Capital, the same one that reportedly is talking with NQ Mobile.

Deadline cited an unnamed source who said Resolution informed its employees that it must wind down operations because Bison Capital didn’t fulfill its “promised funding obligations.” The website also claims that Bison Capital principal Peixin Xu had been writing Resolution even as recently as July offering support.

However, the report claims that he wasn’t supportive. It claims that Bison Capital’s promised funds were late and that the amounts Resolution received were “low,” thus allegedly putting a strain on the talent agency.

Certainly if Bison Capital is interested in committing funds to NQ Mobile, then it isn’t NQ’s fault if the firm backs out like it did with the talent agency. However, it could end up being yet another wrinkle in the controversial Chinese company’s reputation. And NQ doesn’t need any more wrinkles, as it’s been reported that the Securities and Exchange Commission is investigating the company.

The NQ Mobile controversy

NQ Mobile has been in the news since Muddy Waters first accused the company of fraudulent accounting practices. Since then, the company’s stock price has had its ups and downs. Today it continued to decline after yesterday’s news about the rejection of Bison Capital’s offer. The stock fell by as much as 5% during regular trading today.

The stock spiked in February and March but has been declining steadily ever since. In the meantime, the bulls and bears debate the company’s accounting practices. NQ Mobile finally filed its long-awaited 20-F this week, but as short-sellers have pointed out, the Chinese company still owes three quarterly reports.