STOCKS NEWS EUROPE-Blinkx drops after blogger raises concerns

British-listed video search and advertising company Blinkx (Other OTC: BLNKF - news) loses as much as half its value in heavy volume after a U.S. blogger raises concerns about the tech firm's business model.

Traders cite a blog by Benjamin Edelman, an associate professor at Harvard Business School, as being behind the selloff, which questions Blinkx's advertising tactics, as well as raising questions over the value that Blinkx (LSE: BLNX.L - news) provides for advertisers.

Blinkx was not immediately available for comment.

The stock has already traded nearly 13 times its 90 day average volume, compared to an average of 60 percent on the AIM All share index.

At 1439 GMT, it is down 35 percent, slightly up from session lows.

Citi, Blinkx's joint house broker, says that the falls are overdone.

"We view this as a significant overreaction. We see no reason to think our numbers are unsound," Citi writes in a note, pointing out that Edelman has not disclosed the client he is working for, and that his concerns over the company are general investment risks that are "no more unusual than that of many ad tech companies".

"We think this is a significant buying opportunity, but at the same time acknowledge that until the company itself rebuts these claims, trading could be volatile."

Reuters messaging rm://alistair.smout.thomsonreuters.com@reuters.net