MDDs from Lightwave

When trying to import a LWO and applying MDD data, the animation looks like a twisted piece of metal.

The animation in Lightwave is a simple cylinder swaying from side to side. But in Blender the animation is twisting around the z-axis. I thought it might have something to do with the axis difference between LW and Blender, so I rotated and applied the rotation but with the same result.

Totally lost. Please help.