: GS(14)@2014-07-27 01:16:22http://www.casimira.com.hk/
: GS(14)@2014-07-27 01:16:56http://www.hkexnews.hk/APP/GEM/2 ... ls-2014071802_c.htm
: GS(14)@2014-07-27 01:17:39https://hk.news.yahoo.com/%E6%96 ... 00095--finance.html
此外，集資所得將擴充集團零售市場的品牌知名度及 開設新的零售店鋪，包括在香港開設新的專櫃店或專賣店以銷售 「Casimira」品牌及「萊斯艾爾斯」品牌服裝及配飾；品牌宣傳及市場推廣活動；升級企業資源規劃系統以改善管理接入及監 控零售網絡日常營運的統計數據；其餘用作集團的營運資金。(dl)
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: GS(14)@2014-10-01 18:14:54
: GS(14)@2014-10-01 18:16:04http://www.hkexnews.hk/listedco/ ... LN20140930092_C.pdf
: GS(14)@2014-10-01 18:16:20http://www.hkexnews.hk/listedco/ ... LN20140930088_C.HTM
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986 buy 8195
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Bubbles and troubles in Hong Kong
24th September 2015
As readers may recall, last year, Lerado Group (Holding) Co Ltd (Lerado, 1225) announced the proposed sale of its core business of baby strollers and infant car seats to Canadian listed firm Dorel Industries Inc (Dorel) for HK$930m. Lerado was planning to squat on most of the cash proceeds and only pay out $0.30 per share, or $228m. For this reason, we opposed the sale, because of concern that Lerado would become a cash shell trading at a discount to its net asset value. Your editor, David Webb, is a disclosed substantial shareholder currently holding over 8%. However, the sale was approved by shareholders on 16-Sep-2014 and completed on 31-Oct-2014.
Our concerns have now proven justified, culminating in current egregious proposals not just by Lerado but by other listed companies. We hope to stop them, if the regulators will require certain parties to play fairer. This article is long and complicated, and we thought about breaking it into pieces, but the picture becomes clearer if you assemble the whole jigsaw, so here it is. Apart from Lerado, this article covers transactions by numerous other listed companies in which you may have an interest, and several billion US dollars of bubbles.
So pour yourself a large coffee and let's get started.
Lerado share movements
The first sign of movement in Lerado came on 25-Nov-2014. Intelligence Hong Kong Group Ltd (IHK) is a company owned 68.27% by Lerado Chairman Henry Huang Ying Yuan (Mr Huang) and 31.73% by his wife, Jamy Huang Chen Li Chu. IHK owns 148,353,540 shares which was 19.50% of Lerado at 31-Dec-2014, before the recent dilutions. On 25-Nov-2014, our system shows those shares moving from CTBC Asia Ltd (the local subsidiary of a Taiwan bank) where they had rested since 30-Dec-2009, to Convoy Investment Services Ltd (Convoy IS), the brokerage sister of Convoy Financial Holdings Ltd (Convoy FH, 1019). Convoy IS is in the process of trying to list on the GEM in the form of CIS Holdings Ltd, which filed an application proof on 23-Mar-2015, sponsored by Quam Capital Ltd.
There can be any number of reasons for such transfers, but one possibility is that the shares are security for a loan. Banks and brokers are exempt from disclosing security interests in shares pledged to them. It wouldn't be so worrying were it not for the fact that Mark Mak Kwong Yiu (Mr Mak), CEO of Convoy FH and a director of Convoy IS, is also claimed to be an INED of Lerado since 25-Apr-2014. Mr Mak joined Convoy as CFO in 2002.
You may recall that in Some bubbles for New Year (31-Dec-2014) we warned about a bubble then called Finsoft Corporation (Finsoft, 8018), which was then trading at $1.235 (adjusted for the subsequent 2:1 split), with a market value of HK$4.94bn, or 110 times its net asset value. Convoy FH owned over 5% of Finsoft. The stock didn't stop there though. It reached a high of $2.92 on 20-May-2015, when Finsoft was valued at HK$11.68bn. Since then, it has crashed 94.8% to its close on Wednesday (23-Sep-2015) at $0.139, down a net 88.7% since our article. Finsoften aren't what they seem.
The Finsoft bubble allowed Convoy FH to book unrealised gains of HK$238.4m for 2014. It sold 40m shares (2%) of Finsoft on 20-Jan-2015 for about $73.5m (split-adjusted: $0.919 per share) and went below the 5% disclosure threshold. The sale was purportedly on-market but it was far larger than market volume that day of 1.925m shares so the disclosure must be wrong.
Returning to Lerado, another large chunk of 96,805,800 shares (12.71% at 31-Dec-2014) was held by Hwa Foo Investment Ltd (Hwa Foo), 30% controlled by Patrick Chen Chun Chieh (Mr Chen), an Executive Director and the son of the late co-founder of Lerado, and 70% by his mother. He joined the board on 3-Apr-2008 following his father's death on 14-Feb-2008. On 8-Sep-2014 those shares moved from HSBC (where they had rested since 27-Jun-2007) to UBS Securities HK Ltd , and then, more interestingly, they moved to small broker Win Fung Securities Ltd (Win Fung) on 9-Dec-2014, two weeks after IHK's holding moved to Convoy IS. So the Huangs and the Chens had moved custody of 32.21% of Lerado after leaving it untouched for years. More on Win Fung below.
Dispute with Dorel
First let's mention that on 10-Feb-2015, Lerado announced that it was in dispute with Dorel over the final net asset value of the business, which may lead to a partial repayment of the purchase price, in an unspecified "significant" amount.
On 27-Mar-2015, Lerado announced that it could not reach agreement with Dorel, so under the terms of the sale they had agreed to go to arbitration with an independent accountant, not yet appointed. In the 2014 annual results announcement on 30-Mar-2015, Lerado revealed that the disputed amount was HK$307m, which accordingly had been booked as a liability in the balance sheet. Still, Lerado ended 2014 with cash of $797m or HK$1.048 per share and no bank borrowings. The disputed amount was about $0.404 per share, so even if they have to pay all of that back, there would have been $0.644 per share of cash, and net assets of $633m or $0.832 per share.
On 20-Jul-2015, Lerado announced that it and Dorel had appointed RSM Nelson Wheeler as the independent accountant to determine the disputed items. Two months later, the result has not yet been announced. If Lerado were to win all of it, then the pro forma net asset value at 31-Dec-2014 increases to $1.236 per share.
Lerado swaps shares for property from CIFG
The day after the results, 31-Mar-2015, Lerado announced the acquisition of a property in Guangzhou from China Investment and Finance Group Ltd (CIFG, 1126) for HK$39m, but despite being flush with cash, only HK$1m was payable in cash and the rest in 76m new Lerado shares (9.49% of then existing shares) issued under the general mandate at $0.50 each, again a discount to cash and NAV per share.
The intended use of the property is as premises for the residual business of Lerado, which is mainly mobility scooters for the elderly and disabled, or what it calls "medical products". However, even if intended use of the property sounds plausible, the issue of shares at a discount to net cash and NAV was entirely inappropriate. The deal completed on 17-Apr-2015, giving CIFG a 8.59% stake in Lerado. Our system shows that CIFG deposited the shares into CCASS with Astrum Capital Management Ltd (Astrum) on 5-May-2015.
CIFG is not a regular listed company, but is a closed-end investment company listed under Chapter 21. This prohibits taking controlling positions (over 30%) in companies, and requires it to adhere to its stated investment restrictions. We asked the Stock Exchange why CIFG was allowed to invest in property in the first place. The result was this "clarification announcement" on 7-Aug-2015, admitting that investment properties were outside the scope of CIFG's Investment Policy and blaming it on the former Chairman and Vice Chairman. They had been removed by the Board on 14-Sep-2012, 6 months after becoming uncontactable.
Lerado begins money-lending and stockbroking
The "Prospects" section of Lerado's 2014 results indicated a new direction. The board had "concrete financial knowledge and background" and had decided to diversify into "securities trading, money lending business and other financial and property investment." It revealed that on 23-Feb-2015, Lerado had agreed to buy an unnamed target company, for HK$1.6m plus its net asset value. The target was a securities broker and planned to engage in margin financing business after the acquisition was completed. On 17-Apr-2015, Lerado announced that it would reallocate HK$300m of its cash pile for these activities.
On 2-Jul-2015 Lerado announced the name of the target, Yim Cheong Share Broking and Investment Co Ltd, and that the acquisition was completed that day. This was then renamed Black Marble Securities Ltd (Black Marble Securities), and Lerado intended to pump HK$200m into it. This small, nearly-dormant broker at that point had a minimal two licensed staff and minimal holdings in its CCASS account shown here.
Policy note: This highlights a defect in the Listing Rules: if you make a "Major Acquisition" (over 25% of your total assets), then you need shareholders' approval, but if you buy or establish a small company and then pump your funds into this new line of business, then this is completely exempt, even though shareholders are exposed to very new and different risks.
Lerado had also established BlackMarble Capital Ltd, incorporated 28-Jan-2015, a licensed money-lender. The application was gazetted on 27-Feb-2015 and the license was granted on 22-May-2015.
Lerado option grants
On 12-Feb-2015, Lerado granted options over 75m new shares (equivalent to 9.86% of the existing shares), of which half went to an unspecified number of employees, and half to "5 consultants". The options were exercisable for 2 years at $0.592 per share. It makes no sense whatever to be granting options which exercise at less than net cash per share, and much less than NAV per share, diluting both. Staff could have been incentivised with a restricted share purchase scheme to use the company's cash to buy stock in the market, which closed at $0.58 on the date of the option grants.
Despite being options of 2 years duration, 48m of the 75m were quickly exercised. We arranged an inspection of the share register on 14-Apr-2015 to discover who had been in such a hurry. We combined that with two filings of allotments by Lerado, which did not name the recipients. Here are the results:
Shareholder Shares Date entered Status
Chu Chun Ting 7,500,000 11-Mar-2015 1 employee, 1 consultant
Kung Yiu Fai 7,500,000 11-Mar-2015
Chan Kam Fuk 7,500,000 17-Mar-2015 employee
Law Yee Man, Thomas 3,000,000 17-Mar-2015 employee
Wang Zewei 7,500,000 20-Mar-2015 consultant
Wong Sin Fai, Cynthia 7,500,000 20-Mar-2015 consultant
Kwok Wai Leung 7,500,000 2-Apr-2015 consultant
Total so far 48,000,000 14-Apr-2015 3 employees, 4 consultants
That leaves 1 more consultant who has not exercised the options. We recognise some of these names:
Chan Kam Fuk is Dominic Chan Kam Fuk (Dominic Chan), proprietor of accountancy firm Dominic K.F. Chan & Co. He was appointed as Company Secretary of Lerado on 1-Aug-2014.
Thomas Law Yee Man (Mr Law), an architect, is an INED of two listed companies, AcrossAsia Ltd (AcrossAsia, 8061) and Sage International Group Ltd (Sage, 8082). Here's a connection: Mr Law joined AcrossAsia on 28-May-2010, replacing Mr Mak of Convoy, who resigned as INED four days earlier. Perhaps Mr Mak helped to arrange Mr Law as his replacement at AcrossAsia. And here's another connection: Leung Tin Fu (Mr Leung), founder and Chairman of Sage until 14-Dec-2007, is also a pre-IPO holder of 10% of Convoy IS. Dominic Chan was an INED of Sage, resigning the same day as Mr Leung. We don't know what role Mr Law plays as an "employee" of Lerado.
Cynthia Wong Sin Fai (Cynthia Wong) is a solicitor who consults for Robertsons and has been Company Secretary of Suncorp Technologies Ltd (Suncorp, 1063) since 15-Feb-2011. We'll come back to that. We don't know what role she plays as a "consultant" to Lerado.
Wang Zewei (Mr Wang) is the name of the person who in 2014 sold 22.5% of Sincere Smart International Ltd to Hao Wen Holdings Ltd (Hao Wen, 8019) for HK$69m, valuing the business at $306.7m when it had net assets of $2.9m. Two other companies, Capital VC Ltd (Capital VC, 2324) and Unity Investments Holdings Ltd (Unity, 0913), bought 14% and 29.5% for $42.7m and $90m respectively, without naming the vendor(s). For more, see our article Hao Wen, Capital VC and Unity today. We don't know what role Mr Wang plays as a "consultant" to Lerado. He was the only mainlander on the list, and he gave an office address at 10 Gaoxin South 4th Road, Nanshan District, Shenzhen.
Incidentally, Mr Mak was also an Executive Director of Computech Holdings Ltd, now named China Mobile Games and Cultural Investment Ltd (CMG, 8081), from 30-Jul-2008 to 28-Apr-2014, three days after he joined Lerado. In fact he was the only ED of CMG from 17-Sep-2009 to 8-Nov-2011. The Convoy FH IPO prospectus dated 29-Jun-2010 said that despite this, Mr Mak considered Convoy his main focus and "has devoted more than 80% of his time to his duties" at Convoy during 2007-2009 and he would continue to allocate a similar proportion of his time to Convoy after listing. That basically meant that CMG only had about 0.2 Executive Directors!
Win Fung acted as the placing agent for CMG in a placing on 22-Apr-2015.
The option shares were deposited into CCASS via various brokers as follows. Click on the dates to see the movements in CCASS:
Date Broker Number
15-Apr-2015 SBI China Capital Financial Services Ltd (SBI CCFS) 7,500,000
29-Apr-2015 Win Fung 7,500,000
8-May-2015 Gransing Securities Co Ltd (Gransing) 7,500,000
27-May-2015 Gransing 7,500,000
24-Jun-2015 Prudential Brokerage Ltd 7,500,000
4-Aug-2015 Convoy IS 3,000,000
13-Aug-2015 UOB Kay Hian (HK) Ltd 7,500,000
It appears likely that Mr Law deposited his 3m shares with Convoy IS, as all the other deposits matched the 7.5m option grants.
Incidentally, the other pre-IPO investor in 10% of Convoy IS is Howard Jiang Qi Hang, who featured in several previous investigations on Webb-site Reports.
Gransing is a name you will see again - it has acted 4 times as a placing agent for Convoy FH, in a bond placing on 21-Jan-2015 and a bond placing on 16-Sep-2014 as well as two unannounced bond placings on 8-Jul-2014 and 14-Nov-2014 mentioned in Convoy FH's annual report. Gransing's client list in Webb-site Who's Who also shows that it has acted as placing agent for Hao Wen, Suncorp and WLS Holdings Ltd (WLS, 8021), a company which we cover below.
On 22-Apr-2015, probably in response to queries from the regulators, Lerado made a "voluntary announcement" trying, and in our view failing, to justify its decision to use shares rather than cash to buy the property from CIFG.
On 21-May-2015, Lerado announced that it had agreed to subscribe for 130m shares (12.44%) of CIFG at at $0.275, or $35.75m in total, setting up a cross-holding between the two, as CIFG still held 8.59% of Lerado. This was, incidentally, highly dilutive to CIFG, a 66.9% discount to its NAV per share at 30-Apr-2015 of $0.83. This fact was omitted from the CIFG announcement. The issue completed on 2-Jun-2015. Our system indicates that Lerado deposited 70m CIFG shares with Gransing on 23-Jun-2015, and deposited 60m CIFG shares with Kingston Securities Ltd (Kingston) the next day.
On 11-Aug-2015, Lerado cut its holding in CIFG from 128.8m shares (12.32%) to 103.392m shares (9.89%), selling the shares at an average $0.196, a 29% loss. As the stake was cut below 10%, Lerado is no longer a "substantial shareholder" and "connected person" of CIFG under the Listing Rules.
Policy note: the disclosure threshold for substantial shareholdings in HK-listed companies was reduced by law from 10% to 5% on 1-Apr-2003, but the Listing Rules have never been updated to match this.
Lerado issues shares to CAID (0048)
On 26-May-2015, Lerado announced the acquisition of Brilliant Summit Ltd from China Automotive Interior Decoration Holdings Ltd (CAID, 0048), for HK$45m, but again, not using any of the cash pile. Instead, it issued 75m shares at $0.60 each, or 7.82% of the enlarged issued shares of Lerado, further diluting existing shareholders. The target was "engaged in the trading of garment accessories, such as nylon tape, polyester tape and polyester string". It had net assets of just $7.24m and a net profit in the year to 31-Mar-2015 of $0.9m.
In giving reasons, Lerado claimed that "certain fabric products and expertise knowledge of the Target Group can be utilised in the Group's business of manufacturing medial products, including but not limited to powered and non powered mobility aid, wheel chairs and other durable equipment". Stretching the polyester tape further, they claimed that the Target Group's "sizable clientele" would allow Lerado to "penetrate into a new market." This rather ignores the fact that Lerado already had its own expertise in sourcing fabrics for baby strollers, infant car seats and mobility aids over many years.
CAID had purchased Brilliant Summit from its manager, a Mr Cheung Ngai, for HK$42m on 15-May-2013. He apparently goes by the name of "Elman" and apart from Brilliant Summit (products here), he runs another company in the same line of business called San Wah Holdings Ltd. CAID, announcing the sale of Brilliant Summit to Lerado, said that "as a result of the constantly increasing costs of sales and competition, the Company is of the view that its business is not expected to grow at its current rate without further investments and developments." CAID intended to hold the Lerado shares "to achieves earnings in the form of capital appreciation."
The transaction completed on 16-Jun-2015. We can see that CAID deposited the 75m new Lerado shares with Win Fung in two batches, 40m on 23-Jun-2015 and 35m on 14-Jul-2015. Of all the brokers it could use, why this little firm, and why is this the same firm in which Mr Chen and one of the option holders also deposited their Lerado shares? The shares are positioned in the same custodian ahead of an important vote on Lerado's future. To summarise those deposits of shares with Win Fung:
Shareholder Shares Deposit date
Mr Chen (Hwa Foo) 96,805,800 9-Dec-2014
An exercised option holder 7,500,000 29-Apr-2015
CAID 40,000,000 23-Jun-2015
CAID 35,000,000 14-Jul-2015
CAID's new INED or mooncake coordinator
For some light relief, on 4-Sep-2015 CAID appointed a new INED and audit committee member, Ms Adeline Ng Li La, who "has over 10 years of experience in human resources and corporate management". She also has a Certificate of Human Resources Management from HK Baptist University and is "a senior administrative officer of a renowned international technology company in Hong Kong". Wow, she sounds highly qualified, doesn't she?
A quick search discovers her Linked In page (copy here). Since May 2015, she has been personal assistant to the General Manager of Amadeus Hong Kong Ltd - and her duties include "supervise the receptionist and the cleaning lady", "coordinate mooncake distribution", "manage pantry cabinet" and planning the Christmas party. Now this of course is all important work, but probably not that relevant to the duties of a listed company director and audit committee member. We wonder how she was introduced to CAID. This is probably not what HKEx had in mind when it started promoting board diversity, but it's what you get when as a regulator, you let controlling shareholders vote on INED elections.
CAID and Convoy
On 30-Jun-2015, CAID announced a placing via Convoy IS, listing the Financial Adviser as Opus Capital Ltd (Opus Capital) and using the full 20% general mandate of 276.48m shares at $0.485, a 19.2% discount to the closing price of $0.60. However, the price then collapsed, and on 9-Jul-2015, they cut the placing price to $0.345, a 42.5% discount to the original closing price. The placing completed on 21-Jul-2015. Our CCASS analysis shows that 125.48m shares were deposited with Astrum, only 68m with Convoy IS and 25m with Kingston, with the remaining 58m to 4 other brokers.
CAID's interim results for 30-Jun-2015 disclosed a huge unrealised gain of RMB 448.6m (HK$561m) on "held-for-trading investments" which then had a market value of RMB564.0m (HK$705m). In other words, a gain of about 389% in 6 months. No normal stock will give you that, but a bubble stock will. Net tangible assets at 30-Jun-2015 were RMB761.9m (HK$952m) or about $0.689 per share, so the investments accounted for 74% of that.
CAID's interim report contains the following statement, which we regard as false and misleading:
"At 30 June 2015, there was no significant investment held by the Group."
Policy note: Some of the listed companies which have recently reported exceptionally large percentage gains on listed securities must own bubble stocks. If you know what stocks a listed company owns, then you would be able to take the SFC's concentration warnings into account and discount those investments to what you regard as fair value, rather than relying on inflated market valuations. But unfortunately, the Stock Exchange and SFC do not require such disclosure, even when inflated listed investments make up the bulk of a companies net assets. They simply rely on the company having to announce losses as inside information after the bubble has burst, rather than telling you that they hold bubble stocks in the first place.
This is despite the fact that Listing Rules Appendix 16 paragraphs 32(4) and 40(2) (or on GEM, Rules 18.41(4) and 18.59) require that companies disclose "significant investments held, their performance during the financial [year/half-year] and their future prospects". It seems that SEHK just doesn't want to enforce this.
Although the Listing Rules which require such disclosure contain no definition of "significant", it should be seen in the context of the size of the holder's balance sheet and therefore the potential impact on shareholder value if the market value of the investments were to change. Whether the investment is "held-for-trading" or as a long-term "available for sale" asset is irrelevant to the potential impact on shareholder value, except for the fact that profits tax applies to trading.
Separately, many listed companies have avoided the notifiable transaction rules in Chapter 14 by declaring themselves to be "in the business" of trading securities. This then allows them to invest as much of their shareholders' money as they like on purchasing "held-for-trading" securities without announcing the transactions, because they are deemed transactions "of a revenue nature in the ordinary and usual course of business" under Listing Rule 14.04(1)(g). The Stock Exchange should close this loophole. Investments in securities, regardless of how they are booked, should be subject to the notifiable transaction rules.
You might wonder then why CAID did not just cash in some of its $705m of investments rather than raise $94.2m in a placing of 20% new shares, claiming that it needed the money. The results failed to identify these spectacular investments, but noted that by 31-Aug-2015, the value had decreased by 23.5% since the end of June. That's about HK$224m of loss.
CIFG and Lerado: parallel open offers
On 17-Aug-2015, Lerado announced a massive 3:1 open offer of new shares at $0.15 each, a 68% discount to the market price of $0.47, with no excess applications. The primary underwriter is Gransing, the Financial Adviser is Octal Capital Ltd (Octal Capital) and the IFA is Opus Capital, the same as the Financial Adviser to CAID.
As we've said before, deep discount open offers are a form of extortion of existing shareholders, because they are faced with the choice of either being heavily diluted economically, or putting in cash to prevent the dilution. Unlike rights issues, the holder does not have the third option of selling his entitlements to recover the discount and thereby mitigate the economic damage. For this reason, the UK Listing Rules include a limit (set decades ago) of not more than a 10% discount on open offers. Hong Kong, still in many ways a developing market, allows this extortion to continue. See UK Listing Rule 9.5.10.
Adding to this abuse is that an open offer often involves no ability for shareholders to make "excess application" for unsubscribed shares. Nor are the unsubscribed shares sold in the market to capture the premium above the issue price for the benefit of passive shareholders. This leaves the underwriter with the benefit of the discount on shares which shareholders cannot or do not subscribe. In these circumstances, the open offer in practice is a conditional placing of deeply discounted shares with the "underwriter", subject to a right of first refusal by existing shareholders pro rata to their holdings.
Gransing cannot end up as a controlling shareholder of Lerado, so it has to have sub-underwriters. From a disclosure of interest, we can see that Capital VC (mentioned above) is a sub-underwriter for 370m shares, or 9.64% of the enlarged capital. Another disclosure shows that Barry Lau Wang Chi is a sub-underwriter for 370m shares. He is a Responsible Officer of Adamas Asset Management (HK) Ltd (Adamas), which will feature below.
On 9-Sep-2015, CIFG announced a huge 8:1 open offer with no excess applicatoins, "underwritten" by Black Marble Securities, which is owned by Lerado. The Financial Adviser to CIFG is Akron Corporate Finance Ltd (Akron) and the IFA is Opus Capital, the same as Lerado's IFA and CAID's FA.
As Lerado owns less than 10% of CIFG, the underwriting is not a "connected transaction". However, it is blatantly clear that Lerado has a "material interest" in the CIFG transaction and should be prohibited from voting in the EGM of CIFG to approve the open offer. Furthermore, Lerado stands to benefit from any unsubscribed shares at the discounted offer price. As there are no excess applications, this is in effect a discounted placement with Lerado subject to clawback by existing holders.Listing Rule 2.15 states:
"Where a transaction or arrangement of an issuer is subject to shareholders' approval under the provisions of the Exchange Listing Rules, any shareholder that has a material interest in the transaction or arrangement shall abstain from voting on the resolution(s) approving the transaction or arrangement at the general meeting."
Correspondingly, we submit that CIFG should not be permitted to vote in the Lerado EGM, because obviously Lerado is engaged in a commercial transaction with CIFG to provide it with funding under the CIFG open offer.
Mr Chen's "disposal" at a 53% loss
Now, according to a disclosure of interest, on 9-Sep-2015, Mr Chen, ED of Lerado, sold his entire interest of 97,823,800 shares, including a personal holding of 1,018,000 shares and those held by Hwa Foo. Some of it was on-exchange at $0.25, but most of it was off-market at $0.22 because total market volume that day was only 7,625,800 shares. When we look at CCASS movements, on the settlement date of 11-Sep-2015 we see his personal holding of 1,018,000 shares leaving Core Pacific Yamaichi, and only 2,805,800 shares leaving Win Fung, and there have been no reductions in Win Fung's balance since then. So it appears that the other 94,000,000 shares were transferred, off market, to other clients of Win Fung and remain there.
As an ED of Lerado, Mr Chen would have been prohibited from voting in favour of the proposed open offer, so it is a matter of great concern that these shares may have been placed in friendly hands, along with the positions held by CIFG and CAID, to vote in favour (if they are not required to abstain).
This disposal, at a deep discount to cash and to net asset value, of a key block of shares, really makes no economic sense for Mr Chen. If he was unhappy with the effects of the proposed open offer, he could have joined us in voting against the proposal. He was only prohibited from voting in favour. At a purported disposal price (for most of his shares) of $0.22, he appears to have accepted a loss of 53% since the open offer was announced. We find this hard to believe. Accordingly we urge the SFC to investigate the true nature of the transactions and who has bought the shares. We would be surprised if the "buyers" had not been mentioned elsewhere in this article.
China 33 Media (8087)
There's another open offer we need to tell you about, and the background is this.
On 26-Jan-2015, China 33 Media Group Ltd (C33M, 8087) announced that its controlling shareholder, Lizhong Ltd (Lizhong), which had held 243.756m shares (43.13%) had 5 days earlier pledged 192m shares (32.00%) to a lender and on 22-Jan to 26-Jan Lizhong had sold its remaining 66.756m shares (11.13%) in the market. They didn't say who the lender was, but a subsequent disclosure of interest shows that it is funds managed by Adamas, which was mentioned above. Our analysis shows the average price received by Lizhong in the 3 days was $0.4192 per share, a total of $27.98m. Now, why did Lizhong need to sell those shares and borrow that money by pledging the remainder? Read on.
On 10-Apr-2015, CIFG, via its 100% subsidiary New Express Investment Ltd, agreed to subscribe 120m shares (16.67%) of China 33 Media Group Ltd (C33M, 8087) at $0.22, exhausting its general mandate, for a total of HK$26.4m. The deal completed on 22-Apr-2015, diluting Lizhong from 32.00% to 26.67%. Our system shows that on 6-May-2015, CIFG deposited its C33M shares with Gransing.
Three months later, on 24-Jul-2015, C33M announced a massive 7 for 1 open offer at $0.10, a 75.6% discount to the closing price of $0.41, without excess applications. The Financial Adviser was Octal Capital (the same as for Lerado's open offer), and the underwriters were Gransing, Kingston and RHB OSK Securities HK Ltd (RHB OSK). The IFA again was Opus Capital, the same as for Lerado. Lizhong undertook to take up part of its entitlement amounting to 844,799,700 shares, which to the nearest thousand is 4.4 shares for each share it owns, not 7. That would cost it $84.5m, but of course, it had already raised about $27.98m by selling shares in the market in January, so there was a funding gap of $56.5m, or about $0.294 per existing share, which it might have borrowed from Adamas funds.
If CIFG was to maintain its holding, it would have to put in another $0.70 for each share it held. It had sold a few shares but still held 113.622m (15.78%). The share price dived 26.8% on the day after the news, but the prospect strangely seemed to delight CIFG, which undertook not to sell any more and to take up all its entitlements to 795.354m shares at a cost of $79.5m. However, on 4-Aug-2015, C33M announced that it and Gransing had agreed to cut CIFG's commitment to 290m shares. As a result CIFG would be diluted to 7.01% of C33M.
Under GEM Listing Rule 10.39(1) or Main Board Listing Rule 7.24(5)(a), if an open offer is at a ratio higher than 1 for 2 then it must be approved by "independent" shareholders excluding the controlling shareholder or, if none, the executive directors and their associates. So the largest holder of C33M, Lizhong, could not vote in favour at the EGM, as it is an associate of the Chairman.
How convenient, then, that there was another "independent" shareholder who could vote in favour. Look at the EGM results on 31-Aug-2015. CIFG almost certainly voted its 113.622m shares in favour, and only 2,050 other shares voted in favour, while 28,638,000 shares voted against. The open offer was thereby approved, and the prospectus was published on 14-Sep-2015.
The C33M open offer prospectus discloses that several sub-underwriters have been engaged. Gransing, with a commitment of 1,905,200,300 shares (33.07% of the enlarged shares), engaged SBI CCFS for 800m shares (13.89%) and 3 other unnamed sub-underwriters for a total of 540m shares (9.37%), each with less than 5% of enlarged shares. RHB OSK, with a commitment of 500m shares (8.68%) had engaged 2 unnamed sub-underwriters to take all of them.
Kingston, with an underwriting commitment of 1500m shares (26.04%), had engaged but then terminated 4 sub-underwriters to take all of it. One was Harvest Aspect International Ltd, which a filing shows is owned by William Yu Tsung Chin, for 644.64m shares (11.19%). The remaining 3 each had less than 5% but totaled 14.85%. After these 4 were terminated, Kingston engaged a single sub-underwriter for the whole lot. Guess who? Black Marble Securities (owned by Lerado).
SBI CCFS and Black Marble have each failed to file a disclosure of interest.
The denominator in the calculation of percentage for disclosure of interests under s308 of the Securities and Futures Ordinance is based on the number of "issued shares", not the number which may be in issue in the future. So in a 7:1 open offer, there are new shares equivalent to 700% of existing shares. All the filings by the underwriters and sub-underwriters in the C33M case use the wrong denominator (the number of shares which will be in issue if the open offer completes) and hence show the wrong percentage, which should be multiplied by a factor of 8. Anyone with an underwriting commitment equal to 5% or more of the existing shares (in the case of C33M, 36m shares) should make a filing, and clearly, that has not happened, with several sub-underwriters of Gransing, RHB OSK and Kingston. The SFC should require them to correct their filings and to procure filings by their sub-underwriters, including those which have now been terminated.
GreaterChina Professional Services (8193)
Now let's look at how Lerado (via Black Marble Securities) and Akron (Financial Adviser to CIFG on its open offer) have been working together in another transaction.
GreaterChina Professional Services Ltd (GPS, 8193) is listed on GEM and owns Greater China Appraisal Ltd, which values real estate and other assets. On 13-Nov-2014, GPS began to deviate from its core business, by buying 80% of Golden Vault Ltd, which indirectly owns a mainland advertising business with in-elevator poster frames and LCD displays in Changshu, PRC, for HK$110m in promissory notes.
Golden Vault had turnover of RMB 7.34m in 2013 and net assets of RMB 5.73m (HK$7.16m) at 30-Sep-2014. This business was valued by Roma Appraisals Ltd at $184m, because, hey, elevators are difficult to get into - especially when they are going up. That valuer is owned by Roma Group Ltd (Roma, 8072) and the financial adviser on the profit forecast was Akron.
A disclosure of interest shows that on 11-May-2015, China Environmental Energy Investment Ltd (CEEI, 0986) increased its holding in GPS from 2.63% to 5.13%, buying 21.495m shares at $0.556 per share. From our CCASS system we see the shares deposited with Southwest Securities (HK) Brokerage Ltd (SWSHK, formerly Tanrich Securities Co Ltd).
On 8-Jul-2015, Roma announced that it had agreed to lend up to HK$58m to Brilliant One Holdings Ltd (Brilliant One) for 12 months at 12% p.a., secured by 310.85m shares in an unnamed GEM-listed company and guaranteed by persons named Ip Kwok Kwong and Wong Chi Keung, the ultimate owners of Brilliant One. That non-disclosure of the GEM company's name was silly, because it was easily determined that Brilliant One was the 36.23% controlling shareholder of GPS, which eventually announced the loan facility on 4-Aug-2015. Ip Kwok Kwong is the MD of GPS, while Wong Chi Keung (this one) is an accountant with 13 INED positions. The loan facility includes a maximum loan-to-value ratio of 65%. So if they draw the full loan, then the share price falling below $0.287 would trigger a top-up obligation. The shares were moved from Emperor Securities Ltd to Infast Brokerage Ltd on 9-Jul-2015.
On 9-Jul-2015, the day after the share pledge, GPS announced a huge proposed placing of shares under a specific mandate, 2.6bn shares at $0.10, a 74.4% discount to the market price of $0.39, via Black Marble Securities, which is owned by Lerado. The Financial Adviser is Akron (the same as for Lerado's open offer). That represents 303% of the existing shares, and they are not even bothering to make the shares available to existing shareholders by an open offer or rights issue. Simultaneously, it was proposed that SEEC Media Group Ltd (SEECM, 0205) would subscribe 1.4bn shares at the same price, a total of $140m, for 28.82% of the enlarged shares.
Policy note: As we mentioned above, open offers or rights issues larger than 1 for 2 (a 50% enlargement of issued shares) must be subject to shareholders' approval with controlling shareholders abstaining, or if there are none, then with executive directors and their associates abstaining. That does provide some small measure of protection, (unless the vote is being manipulated with warehoused shares). However, this protection is negated by the fact that a massive placing under a "specific mandate" can be approved without requiring controllers or executive directors to abstain. The Listing Rules should be amended to close the loophole so that controllers/executive directors should be required to abstain from voting in favour of any proposal to approve a "specific mandate" that enlarges the issued shares by more than 50%.
Brilliant One, which has pledged its controlling shareholding to Roma, was allowed to vote to approve this outrageous proposal.
Of the $395.1m net proceeds, GPS intends to use $100m in its money-lending subsidiary, Colbert Finance Ltd, and $150m to develop its securities brokerage business. It doesn't own a stockbroker yet, but it plans to either buy one or set one up. The EGM approved the placing on 14-Sep-2015 without objection. With an avalanche of shares due to hit the market at $0.10, it is quite impressive that the stock still closed at $0.495 on 23-Sep-2015.
Now let's look at a fourth open offer involving Lerado (via Black Marble Securities) and Opus Capital.
SEECM is, or was, principally engaged in advertising agency, distribution of books and magazines. And securities trading, of course, like all shoddy companies should be. It announced its investment in GPS on 10-Jul-2015.
On 17-Jul-2015, SEECM announced that it had agreed to subscribe 103.02m shares (16.67%) of China New Economy Fund Ltd (CNEF, 0080) at $0.385, for a total of HK$39.66m, exhausting CNEF's general mandate. CNEF is another Chapter 21 investment company, and that was a 61.5% discount to the NAV of CNEF at 30-Jun-2015 of $1.00. As we noted in our article Some Bubbles for New Year on 31-Dec-2014, CNEF had shares in the Finsoft bubble alongside Convoy FH, and Tony Tai Man Hin, the CFO and Company Secretary of CNEF, was an INED of Finsoft. He retired from Finsoft on 5-May-2015. The CNEF announcement of the subscription named Astrum as the placing agent and did not mention the discount to NAV.
Also on 17-Jul-2015, SEECM announced that it is applying to the SFC to set up a stockbroker. Now everyone wants to be a broker. Lerado, GPS and SEECM.
On 19-Aug-2015, SEECM announced a huge open offer, 3 for 1 at $0.10, a 61.5% discount to the market price of $0.26. The Financial Adviser is Opus Capital (the FA of CAID and the IFA of C33M and Lerado), the IFA is Hercules Capital Ltd (Hercules) and the underwriter is Black Marble Securities, owned by Lerado. Again there will be no excess applications, so the "underwriter" gets the benefit of discounted unsubscribed shares. Of net proceeds of $624m, SEECM plans to use HK$365m to set up a stockbroker, $30m to set up a corporate finance advisory and asset management firm and $225m for the acquisition and operation of an unspecified e-commerce platform.
The shares dived on the news, dropping 35.4% to $0.168 the next day. But they weren't done yet. On 9-Sep-2015, they decided to increase the carnage by consolidating the shares 2:1 and then changing the offer terms to 5 new shares for each consolidated share at $0.10, equivalent to $0.05 before the consolidation. So the offer discount becomes an effective 80.8% discount to the original closing price of $0.26. This will raise a bit less though, HK$519m. This news caused another drop in the price, by 16.7% from $0.156 to $0.13 the next day. So the stock price had now halved even before putting the plan to a vote.
A circular for the capital reorganisation went out on 18-Sep-2015 for an EGM on 12-Oct-2015. We urge shareholders to vote against the resolutions. They are special resolutions that require a 75% majority to pass, so blocking it is more feasible than usual. If it passes, then a circular to propose the open offer is due out on 28-Oct-2015.
Chan Cheong Yee and CESHK
There is a common person to a number of these companies. Chan Cheong Yee (C Y Chan) is a Responsible Officer of China Everbright Securities (HK) Ltd (CESHK). CESHK is the investment manager of four Chapter 21 companies: CIFG, CNEF, China Innovation Investment Ltd (CII, 1217) and China Investment Development Ltd (CID, 0204). C Y Chan is an ED of all 4 companies, and he is also an ED of Capital VC.
CID is in its own little bubble - it closed on 23-Sep-2015 at $0.157, compared with NAV of $0.024 at 31-Aug-2015.
Now remember we mentioned CEEI, the investor in GPS? On 12-Nov-2014, CEEI announced a placing of 48,190,489 shares at $0.97 per share to raise HK$46.28m, exhausting the general mandate, followed by a huge 8:1 rights issue at $0.195 per share, an 82.4% discount to the market price of $1.11, to raise between $376m and $451m. Excess applications were allowed. At the time, CEEI had no substantial shareholders.
Win Fung was both the placing agent and the rights issue underwriter. The placing was on a best efforts basis, and on 27-Nov-2014, the placing price was cut to $0.66. The placing was completed on 3-Dec-2014, and all the shares were deposited into the CCASS account of Win Fung for its clients. Not a single share moved out of that account until after the EGM to approve the rights issue. And guess what, the EGM results on 18-Dec-2014 show that the number of shares voted in favour of the rights issue was 48,437,576, just 247,087 more than the number of placing shares.
On 12-Mar-2015, CEEI announced that it would start investing in "quality stock and other financial products", so don't say you weren't warned! On 17-Apr-2015, CEEI announced that it had bought 51m shares (0.337%) of Suncorp (mentioned above) that day in the market for HK$61.45m at an average of $1.205 after a huge run up in the share price following completion of a placing at $0.245 per share on 13-Apr-2015. The stock closed at $0.204 on 23-Sep-2015, down 83% since the purchase by CEEI. Some of the other investments by CEEI are covered below.
Now let's tell who may have benefitted from a huge bubble in the shares of WLS Holdings Ltd (WLS, 8021), a construction company.
As background, on 21-Oct-2014, WLS announced that CIFG would subscribe for 79m shares (16.67% of enlarged) at $0.177, a 0.6% premium to market, exhausting the general mandate. On the face of it, WLS had no other substantial shareholders. The deal completed on 31-Oct-2014. The shares were deposited with Fordjoy Securities and Futures Ltd (Fordjoy) on 5-Nov-2014. CIFG rapidly sold off the shares, from 12-Nov-2014, dropping below 5% on 3-Dec-2014.
WLS owns a licensed money-lender, Gold Medal Hong Kong Ltd, incorporated on 19-Mar-2014 and licensed on 26-Nov-2014.
On 21-Jan-2015, WLS announced a 5:1 share consolidation and a proposed massive placing of 540m consolidated shares (563.16% of the existing shares) at $0.30 via SWSHK (then Tanrich Securities Co Ltd). The Financial Adviser was Akron. This placing price was a 42.3% discount to the adjusted closing price of $0.52. At the 5-Mar-2015 SGM to approve the placing, votes in favour were 89,597,500, or 18.69% of the issued shares. Total turnout was only 19.00%. We suspect most of those votes in favour were shares previously held by CIFG, but we'll never know for sure.
Of the 540m shares, we know that CEEI took 63m shares (9.91% of enlarged), because it announced the subscription on 18-Mar-2015. Disclosures of interests show that Samuel Chiu Se Chung, a licensed Representative of Roofer Securities Ltd, also subscribed 9.9%. Unity, mentioned above, subscribed 31.5m shares (4.95%), as did Capital VC, mentioned above and Avant Capital Management (HK) Ltd (Avant), as asset manager. Mr Ye Ruiqiang subscribed 4.95%. As of 31-Dec-2014, he owned 6.44% of Capital VC.
There are 4 subscribers whom we cannot identify. A person named Zhang Yan subscribed 40.67m shares (6.40%) which were probably deposited with Emperor Securities Ltd, and a person named Zheng Wanying subscribed 31.33m shares (4.93%). A person named Civic Cheung Sun Kei subscribed 54m shares (8.49%) and another named Cheung Kam Hong subscribed the same number.
A person named Wong Chun Wah subscribed 23m shares (3.62%). It's a common name but we see that the same number went to the custody of Henik Securities Ltd, where there is a licensee called Wong Chun Wah. Similarly a person named Ma Kin Lung subscribed 31.0m shares (4.88%), and we see that number deposited with Get Nice Securities Ltd, where Ma Kin Lung is a licensed representative.
A person named Tam Siu Ki subscribed 54m shares (8.49%), increasing his stake to 9.28%. That may or may not be the same as Simon Tam Siu Ki, who was a representative of RHB OSK (then known as Prudence Securities Co Ltd) until his license was revoked on 30-Oct-2003 for rat-trading and other trading malpractices. In summary, then after the placing, the holdings were:
Name Shares Stake %
1 CEEI (0986) 63,000,000 9.91
2 Samuel Chiu Se Chung 63,000,000 9.91
3 Tam Siu Ki 59,000,000 9.28
4 Cheung Kam Hong 54,000,000 8.49
5 Cheung Sun Kei, Civic 54,000,000 8.49
6 Zhang Yan 40,670,000 6.40
7 Avant 31,500,000 4.95
8 Capital VC (2324) 31,500,000 4.95
9 Unity (0913) 31,500,000 4.95
10 Ye Ruiqiang 31,500,000 4.95
11 Zheng Wanying 31,330,000 4.93
12 Ma Kin Lung 31,000,000 4.88
13 Wong Chun Wah 23,000,000 3.62
Total 540,000,000 85.71
The WLS placing completed on 27-Mar-2015 and the CCASS deposits are here. By that time, the stock had more than doubled to $1.25. Unlike the allotments after the IPO, there was no concentration warning. Yet 13 holders held 85.71% of the stock.
The price continued to climb. On 15-May-2015, with the stock at $2.26, 7.53x the placing price, WLS announced a 7:1 bonus issue. The stock spiked again and was suspended at $4.27 on 17-Jun-2015, prompting the company to announce that it was negotiating for a possible share issue. After a brief correction to $2.50, it was suspended again on 19-Jun-2015, pending announcement on 23-Jun-2015 of a "framework agreement" for possible subscriptions by Avant and Shin Kong Capital Management Inc (SKCM) of 1920m and 5760m shares (post-bonus) at $0.06875, a 78% discount to the bonus-adjusted closing price of $0.3125, to raise $528m gross and enlarge the issued shares by 151%.
While the stock was suspended, it went ex-bonus on 23-Jun-2015 and the bonus shares were distributed on 3-Jul-2015, so for 10 days straddling the half-year point, only 1/8 of the company was tradable. When trading in those shares resumed on 24-Jun-2015, the stock shot up again on heavy volume, reaching a daily high of $1.22 on 26-Jun-2015. Remember that most of the existing shares had been issued at a bonus-adjusted $0.0375, so they were now up 32.5x. WLS closed at $1.05 on 30-Jun-2015, allowing those listed companies which held the stock to book enormous "fair value gains" in their interim results. At the end of June, WLS had a market capitalisation of HK$5341m, compared with net tangible assets at 30-Apr-2015 of HK$282m ($0.055 per share), so it was trading at 18.9x NAV.
Disclosures of interest indicate that SKCM was using a vehicle called SKCM TMT I, L.P., which was 50% owned by Chiang Chun Yi and 50% by Yam Tak Cheung, and managed by SKCM TMT GP Co. Ltd, which is 40% owned by SKCM. After all that excitement, SKCM backed out of the deal on 8-Aug-2015 citing disagreement over due diligence on WLS, but Avant signed a new agreement on 12-Aug-2015 to continue to subscribe 1920m shares at $0.06875, conditional on WLS issuing at least 252m shares in a fund-raising exercise so that Avant ends up with 29.48% of less - certainly under the 30% takeover trigger.
Now this long and winding road takes us back to Lerado. On 18-Aug-2015, WLS announced two placings via Black Marble Securities, owned by Lerado. The underwritten tranche is of 360m shares (7.08% of existing shares) at $0.06875, and there is a further "best efforts" placing of 5400m shares (106.15%) at the same price, at 82.1% discount to the closing price of $0.385. Together these could raise $389.22m mostly for, you guessed it, money-lending and securities business. The shares closed on 23-Sep-2015 at $0.27, down 74.3% since the end of June, but still at 4.9x NAV.
Raise the umbrellas: China Jicheng (1027)
Perhaps the most ridiculous bubble in our market at present (although there is a lot of competition for that title) is umbrella maker China Jicheng Holdings Ltd (CJ, 1027) which listed on 13-Feb-2015. It peaked on 18-Sep-2015 at $3.18 with a market value of HK$47.7bn, compared with net tangible assets in the 30-Jun-2015 interim results of $399.6m, or $0.0267 per share. So it was trading at 119x NTA.
Adjusting for a 25:1 stock split in June, CJ's IPO priced the shares at $0.044, so was up 72.3x since the IPO. This gives new meaning to the term "umbrella movement". The initial custody positions of the 150m IPO shares (25%) are in our records here. The top 3 brokers will now be familiar to you: Gransing (8.72% of CJ), Win Fung (8.18%) and SWSHK (3.73%), a total 20.64% or 82.54% of the float.
On 14-May-2015, the SFC warned that 16 shareholders owned 24.02% of CJ, or 96.08% of the float, leaving 0.98% of CJ for everyone else. The stock closed at $13.76 the day before that warning, or $0.5504 after the stock split, so it is up 5.14x since then.
In its annual results for 31-Mar-2015, CEEI (mentioned above) disclosed a holding of 12.67m shares (2.11%) in CJ at a purchase cost of $1.10 per share, which means they were allocated in the IPO, because they have never traded that low. After the stock split that will be 316.75m shares at $0.044. So CEEI doesn't always pay bubble prices for bubble shares - it occasionally gets in at the bottom.
The controlling shareholder of CJ is its Chairman, Huang Wenji, with 11.25bn shares (75%) which, on paper, makes him a US$ umbrella multi-billionaire. We note that on 17-Sep-2015, he deposited 1.5bn shares into CCASS with Black Marble Securities, owned by Lerado. That could be preparation for a placing of existing shares and possibly a subscription of new ones, if anyone is dumb enough to buy them.
Lerado interim results show massive gain
Lerado is one of several companies which have made enormous market gains in the first half of 2015 without disclosing what stocks it bought. In the 30-Jun-2015 interim results, it disclosed "held-for-trading investments" comprising "equity securities listed in Hong Kong" of HK$702.1m. It also said that by 28-Aug-2015, the value had declined by 11%. It booked an unrealised gain of $626.5m, implying a purchase cost of $75.6m and a gain of 829% in 6 months or less. No normal stock does that. Whatever stock(s) they hold, it must be bubble paper, and investors deserve to know what it is so that they can make their own assessment of "fair value" rather than relying on an artificial market price.
After providing for $105m of profits tax on the gains, Lerado had net tangible assets at 30-Jun-2015 of $1220m, or $1.27 per share. But if those gains evaporate, then the NTA drops to $698.5m, or $0.728 per share. Both figures are before dilution from the proposed open offer. If the offer proceeds, then that NAV would be diluted to about $0.430 (with the gains) or $0.295 (without the gains). Both figures assume that Lerado loses the Dorel arbitration, which is worth $307m, which is $0.320 per share before the open offer or $0.080 per share after the open offer.
Capital VC's open offer
On 13-Mar-2015, Capital VC announced a 5:1 share consolidation to be followed by a 7:1 open offer at $0.25 per consolidated share without excess applications. That was a 76.5% discount to the adjusted closing price of $1.065 per share. The Financial Adviser was Akron, and the "underwriter" was SBI CCFS. The last published NAV at 28-Feb-2015 was an adjusted $4.821, so the issue discount to NAV was 94.8%. The stock sold off on the news, down 39.9% the next day to an adjusted $0.64.
Policy note: Chapter 21 investment companies like Capital VC have to publish their NAV monthly. This involves valuing all their listed investments at market prices, so they know what they are. Until 2002, these announcements had to be published in newspapers, so space was at a premium. Now that announcements are online for the last 13 years, this is no longer the case. Yet the Listing Rules still only require Chapter 21 companies to disclose the top 10 investments once per year in the annual report. This is ridiculous. The top 10 investments should be disclosed every month so that shareholders know what risks they are taking.
Again, investors faced the extortion of having to either see the investment heavily diluted, or put in more cash, and no excess applications were allowed, so it is really a placing with the "underwriter" subject to first refusal of existing holders pro rata. The underwriter benefits from any unsubscribed shares at a discount to market. To eliminate the possibility of SBI CCFS holding a controlling stake, it had to arrange sub-underwriters. They included Gransing, for 180m shares, Jun Yang Securities Co Ltd (Jun Yang Securities), for 152m, Avant, for 142.5m, and Fordjoy, for 80m shares.
Incidentally, SBI CCFS is 52% owned by Cao Guo Qi, a director of several listed companies, and 48% by Zhang Xiongfeng, the current Chairman of CMG, mentioned above.
On 11-Jun-2015, Capital VC shareholders approved the consolidation and open offer without objection. Voting turnout was only 14.39% of the issued and eligible shares, probably including the 6.44% owned by Ye Ruiqiang.
Policy note: shareholders are often unaware of opportunities to protect themselves by voting against such egregious proposals, because the SFC does not require banks and brokers who hold their stock to inform them of EGMs and seek voting instructions. As a result, most banks and brokers, in the small print of the client contracts, state that they are not obliged to do so. This is a major barrier to investor participation in governance, and the SFC should act to resolve this, as we said in our submission Principles of Responsible Regulation (26-May-2015).
On 24-Jun-2015, six days before Capital VC's financial year-end, it announced that it was changing its year-end to 30-Sep-2015, so it would produce a second set of condensed "interim" results for the 12 months to 30-Jun-2015. The purported reason for this was:
"to align the Company's financial year end date with that of the Company's principal associate, CNI Bullion Limited, which is the Group's substantial investment."
This holds no water though. Remember, Capital VC is a Chapter 21 investment company, so under Rule 21.04(3)(a), it is not allowed to take "legal, or effective, management control of underlying investments" and under Rule 21.04(3)(b) it is required to maintain a "reasonable spread of investments". So there is no logical reason to align the year ends of Capital VC and any of its investments, including CNI Bullion Ltd, which only accounted for 9% of Capital VC's NAV at 31-Dec-2014.
So what was the real reason for extending the year-end? In our view, to delay the annual disclosure of the portfolio. It's so embarrassing to have to show that your castle is built on sand.
On 15-Jul-2015 Capital VC announced that its NAV at 30-Jun-2015 was $9.0782 per share, and on 27-Aug-2015 it announced the second interim results for the 12 months to June. Capital VC booked a pre-tax profit on financial assets of $1314m for the 12 months, compared with $163m in the first 6 months, so the second-half profit was $1151m. As an investment company, it does not distinguish between realised and unrealised gains, but we can deduce them from the amount of deferred tax, which is tax that is only payable when they cash out. Note 8 shows deferred tax of $132m, so as profits tax is 16.5% they have about $800m of net unrealised gains, probably in bubble stocks.
Anyway, with that NAV in mind, let's return to the open offer. 7:1 at $0.25, versus NAV of $9.0782, so the open offer would dilute NAV to $1.354 before expenses. Shareholders who did nothing would lose 85% of their net asset value. Yet, when the offer closed on 9-Jul-2015, only 23.7% of the shares were subscribed. That left the underwriters and whoever was behind them with 66.75% of the company, acquired at $0.25 per share. The market price closed that day at $0.32. Due to market losses in July, the NAV closed that month at $1.0292, and $0.8824 at the end of August. Amazingly there was nobody with a disclosed 5% shareholding after the offer closed.
Meanwhile, even in market price terms, the shareholders who did not subscribe (and most of them did not vote against the open offer) had seen the price collapse from $1.065 before the open offer to $0.32, even while Capital VC was racking up huge gains as a holder of the unnamed inflated stocks.
Jun Yang (0397)
Jun Yang Securities is owned by Jun Yang Financial Holdings Ltd (Jun Yang, 0397). Until August, this was known as Jun Yang Solar Power Investments Ltd, but that's out of fashion, so now, like everyone else, it wants to be a financial services powerhouse.
Note 24 on page 113 of Jun Yang's 2014 annual report reveals that it owned 2.49% of Tech Pro Technology Development Ltd (Tech Pro Technology, 3823) and 4.49% of Town Health International Medical Group Ltd (Town Health, 3886). Those had a market value of about HK$235m and $280m respectively, out of total listed equities of $854m. Jun Yang booked an unrealised gain on held-for-trading investments of HK$350m for 2014, without which it would have made a loss before tax of $98m.
Tech Pro Technology (3823)
This is another bubble stock, up 93.14% in 2014, and it has kept on going, up a net 22.62% this year so far. It closed on 23-Sep-2015 at $1.87, valuing the firm at HK$12.13bn. When a company includes the syllable "Tech" in its name twice, you know it is desperate for attention. The company makes LED lamps and losses. Oh and football. Yes, it has bought a French soccer club, FC Sochaux-Montbeliard SA. After all, why sponsor the shirts when you can buy the whole thing?
The interim report at 30-Jun-2015, shows net tangible assets of RMB475m (HK$594m) or about HK$0.092 per share. Turnover for the period was RMB111m, so if you annualize that you get RMB222m or HK$278m. So the shares are trading at about 20.4x NTA and about 44x turnover.
This is another bubble stock. L & A International Holdings Ltd (L&A, 8195) makes cashmere sweaters. It listed on 10-Oct-2014 after a placing at $0.06 per share (adjusted for the 10:1 split on 21-Apr-2015). In the placing, the top 10 placees received 89.74% of the float. It closed on 23-Sep-2015 at $2.92, up 48.7x since the listing. The market value is HK$11.68bn, compared with net tangible assets of HK$129m at 31-Mar-2015, or about $0.032 per share, so it trades at 90x book value. Revenue for the year was $350m, so it trades at 33x sales.
Despite this ridiculous valuation, or perhaps because of it, CEEI bought 69.384m L&A shares (1.73%) in the market from 17-Apr-2015 to 12-May-2015, spending a total of HK$112.7m or an average of $1.62 per share. This was announced on 12-May-2015. Of course, we don't know who the sellers were. Lucky them.
On 24-Jun-2015, the SFC issued a concentration warning, noting that 19 shareholders held 23.18% out of the 25% float.
What you have seen here is a repeated pattern of abuse. The key steps in several transactions are:
Position votes in friendly hands which are not visibly connected to controlling shareholders or executive directors, by issuance of new shares or transfer of existing shares.
Arrange loan financing for any existing controller to take up entitlements, or even sell shares in the market with enough time gap to deter allegations of insider dealing.
Announce either (i) a large, deep-discount open offer without excess applications; or (ii) a "special mandate" placing, which in the first case will need "independent" shareholders' approval and in the latter, just shareholders' approval.
Use friendly votes to approve the proposal which damages the financial interests of anyone who cannot or does not put up cash (in the case of a placing, this isn't even an option).
Complete the fund-raising and receive deeply discounted shares as the underwriter, sub-underwriter or placee of the shares.
Hong Kong deserves better if it wishes to make a claim to be a world-class financial centre.
© Webb-site.com, 2015
: greatsoup38(830)@2015-11-29 12:37:20
: greatsoup38(830)@2016-01-26 20:31:08
: GS(14)@2016-03-15 20:38:41
: greatsoup38(830)@2016-03-26 03:39:20
: greatsoup38(830)@2016-05-01 01:05:43
: greatsoup38(830)@2016-05-14 02:48:07
: greatsoup38(830)@2016-05-14 02:48:07
: greatsoup38(830)@2016-05-14 03:20:43
: greatsoup38(830)@2016-05-22 10:48:28
: greatsoup38(830)@2016-06-22 02:45:41
: greatsoup38(830)@2016-06-24 07:44:35
: greatsoup38(830)@2016-07-03 15:09:12
: greatsoup38(830)@2016-07-07 02:21:34
8179 賣 8195
: greatsoup38(830)@2016-07-09 07:18:20
8179 賣 8195 虧
: greatsoup38(830)@2016-07-22 07:27:54
配售2,869,886,385 股 @2.9仙
: greatsoup38(830)@2016-07-24 02:27:43
: greatsoup38(830)@2016-07-29 03:51:45
: GS(14)@2016-08-17 11:41:31
cannot blow water
: greatsoup38(830)@2016-08-18 06:35:52
: Clark0713(1453)@2016-08-19 00:09:15
#8021 buy #8195
就每400股樂亞股份 . . . . . . . . . . . . . . . . . . . . . . . . . 57股新滙隆股份及現金5.60港元"
: GS(14)@2016-08-19 06:25:41
: GS(14)@2016-08-19 06:26:18
: greatsoup38(830)@2016-08-19 07:34:29
: GS(14)@2016-08-19 15:01:56
: greatsoup38(830)@2016-08-21 01:32:34
: greatsoup38(830)@2016-08-21 01:35:04
: greatsoup38(830)@2016-08-21 04:43:33
: greatsoup38(830)@2016-08-21 05:05:10
8120 holds 8195、1389、8193、986、8087、736、1027、8217
: greatsoup38(830)@2016-08-28 02:06:47
: greatsoup38(830)@2016-09-13 00:26:23
8021 發現 8195 多左16億股、2億權，所以加入權代價
: GS(14)@2016-10-14 06:05:43
: GS(14)@2016-10-14 14:24:07
243 buy 8195
: hopingu(1296)@2016-10-17 16:34:59
8195 咁值錢咩? 家下係243 同 8021爭住買?
: GS(14)@2016-10-18 02:42:23
8195 咁值錢咩? 家下係243 同 8021爭住買?
: GS(14)@2016-10-18 03:04:41
8021 取消8195 購回
: GS(14)@2016-10-18 03:23:46
: greatsoup38(830)@2016-11-12 21:22:57
: greatsoup38(830)@2016-11-16 11:42:07
: sunshine(3090)@2016-11-20 10:54:23
243 still want to acquire 8195http://www.hkexnews.hk/listedco/ ... TN20161117726_C.pdf
: GS(14)@2016-11-20 18:30:12
243 still want to acquire 8195
http://www.hkexnews.hk/listedco/ ... TN20161117726_C.pdf
: greatsoup38(830)@2016-11-26 10:46:32
: greatsoup38(830)@2016-11-30 00:12:44
: 暗月(57870)@2016-11-30 01:29:52
: GS(14)@2016-12-01 00:08:22
: greatsoup38(830)@2017-02-06 00:58:05
於二零一七年二月三日，本公司接獲由Joung Jong Hyun先生（「Joung先生」）作為
（「馬先生」）；(v) 本公司獨立非執 行董事陳銘燊先生（「陳先 生」，連同吳 先生、黃
先 生 、 鄺 先 生 及 馬 先 生 統 稱 為「 該 等 董 事 」）； (vi ) 本 公 司 ； 及 (vii ) 希 仕 廷 律 師 行
（「 希 仕 廷 」（） 統 稱 為「 該 等 被 告」）所 發 出 日 期 為 二 零 一 七 年 二 月 一 日 之 傳 訊 令 狀
據 傳 訊 令 狀 大 致 上 聲 稱 ， Joung 先 生 尋 求（ 其 中 包 括 ）(i) 宣 判 該 等 被 告 就 律 師 費 從
: greatsoup38(830)@2017-02-06 01:08:10
: greatsoup38(830)@2017-02-14 00:19:58
: greatsoup38(830)@2017-03-03 01:33:15
243 buy 18% 8195
: GS(14)@2017-04-25 14:34:01
: GS(14)@2017-05-17 10:28:45
: GS(14)@2017-06-14 12:29:59
茲 提 述 本 公 司 日 期 為 二 零 一 六 年 十 二 月 二 十 三 日 之 公 佈 ， 內 容 有 關 Lim Hang
LIM HANG YOUNG之清盤呈請書
於二零一七年六月九日，本公司接獲Lim Hang Young先生（「呈請人」）於二零一七
年六月六日針對答辯人(i)本公司及(ii)Yang’s Holdings Capital Limited（「第二答辯
呈請人指稱（ 其中包括 ）(i)第二答辯人曾向本公司借出其業務，並為空殼公司實際
擁有人代 持股份；(ii)第 二答辯人曾參與多 項股份質押借貸 活動；(iii)收購Red 5
: GS(14)@2017-06-30 17:23:11
: GS(14)@2017-07-30 22:18:11
: GS(14)@2017-08-08 03:14:18
該 物 業 為 位 於 沙 田 大 圍 積 輝 街 一 個 零 售 店 舖 ， 總 面 積 約 為 300 平 方 呎 。 位 於 積 輝
代 理 獲 得 的公 開 資 料 ， 最 近 出 租 或目 前 可 供 出 租 且 僅 面向 一 條 街（ 即積 輝 街 或 美
田 路 ）的 店 舖， 租金 介乎 約 每平 方呎 209 港 元至 每平 方 呎340 港 元 ，而 該物 業 的租
出 售 該 物 業 時 ， 要 約 價 為 39,000,000 港 元 。 因 此 ， 董 事 會 經 考 慮 (i ) 位 置 具 吸 引
出 300,000 港 元 ， 及 (b ) 高 於 要 約 售 價 中 位 數 ， 收 購 事 項 的 應 付 代 價 約 每 平 方 呎
: GS(14)@2017-09-07 10:32:39
未 發 行 股 份 合 併 為 一 (1) 股 每 股 面 值 0.04 港 元 的 合 併 股 份 。 股 份 合 併 須 待（ 其 中
: GS(14)@2017-11-18 16:46:57
: GS(14)@2017-12-06 01:11:03
8195 持有 8179、1259
: GS(14)@2017-12-07 15:01:52
8179 8195 1259 RUBBISH COOPERATIONhttp://www.hkexnews.hk/listedco/ ... LN20151209042_C.pdfhttp://www.hkexnews.hk/listedco/ ... TN20171124520_C.pdfhttp://www.hkexnews.hk/listedco/ ... LN20171205130_C.pdfhttp://www.hkexnews.hk/listedco/ ... TN20171207240_C.pdf
: GS(14)@2018-02-07 17:27:55
: GS(14)@2018-02-07 17:50:31
: GS(14)@2018-03-24 12:57:04
: GS(14)@2018-07-04 01:25:09
: GS(14)@2018-07-16 07:55:38
: GS(14)@2018-08-16 05:23:36
8195 賣 1259
: GS(14)@2018-11-14 15:41:12
: GS(14)@2018-12-12 03:13:31
該公司在 GEM 上市之前，自 2014 年 9 月 25 日起已採用該計劃。上市後，在下文所載的
事件前，該公司並未根據該計劃發出任何股份期權。該計劃第 5.2 條列明，董事「不得」在
得悉內幕消息後向任何參與者提出要約，直至有關內幕消息按《GEM 上市規則》第 16.17
至 16.19 條公布為止，尤其是在(i) 董事舉行會議通過該公司業績（年度、半年、季度及其
他中期）的日期或 (ii) 該公司刊發業績公告的限期（以較早者為準）之前一個月起直至業績
公告當日止這段期間，不可授出股份期權。此條與《GEM 上市規則》第 23.05 條相若，只
是規則所用字眼是「may not」（不可）而非「shall not」（不得）。
該公司於 2016 年 7 月 12 日向聯交所發出書面通知，表示為了公布 2016 年首季業績，
2016 年 7 月 13 日至 2016 年 8 月 12 日為其禁止買賣期。於 2016 年 7 月 15 日，該公司
宣布於 2016 年 8 月 12 日舉行董事會會議，以審議及通過 2016 年首季業績（2016 年首季
業績最終於 2016 年 8 月 12 日公布）。
然而，於 2016 年 7 月 22 日上午 8 時 30 分，相關董事在董事會會議通過向 10 名承授人授
出 20 億股股份期權（「授股」），每人可獲 2 億股股份期權。該公司在 2016 年 8 月 23
授股日期： 2016 年 7 月 22 日
每名承授人可認購的股份數目： 2 億股
授股的代價： 1.00 元
行使價： 以下三項的最高者：每股 0.0256 元
（於 2016 年 7 月 22 日前 5 個交易日的股份平
均收市價）、2016 年 7 月 22 日的股份收市價
（0.024 元）或股份的賬面值（0.002 元）。
其中 8 名承授人是該公司在 2014 年於 GEM 上市時所牽涉的保薦人及承銷商的員工。另一
於 2016 年 8 月 5 日，該公司刊發截至 2016 年 7 月 31 日止月份的股份發行人證券變動月
2016 年 8 月 20 日至 21 日期間，8 名承授人以電郵通知該公司，表示會行使他們獲授的股
份期權。董事會於 2016 年 8 月 21 日舉行會議通過向承授人發行股份，惟在承授人正式簽
於 2016 年 8 月 22 日，該公司向 8 名承授人發行 16 億股股份（「該等新發行股份」）。
於 2016 年 8 月 23 日，該公司公布授股（「授股公告」），但沒有披露其中 16 億股股份
期權已獲行使並已配發該等新發行股份予 8 名承授人。反之，公告中提及股份期權所涉及的
股份（當中 16 億股已經發行）時，仍稱之為股份期權獲行使後「將予發行」的股份。
於 2016 年 8 月 24 日上午 7 時 57 分，該公司發出內幕消息公告（「內幕消息公告」），
股份期權行使後「將予發行」的股份。該公司於上午 8 時 04 分方刊發翌日披露報表
（「翌日報表」），揭示 2016 年 8 月 22 日已發行該等新發行股份。
《GEM 上市規則》第 23.05 條列明，發行人「may not」 （不可）在訂明的期限（指禁止
亦不含糊地寬容，指《GEM 上市規則》第 23.05 條並沒有強制的意思。該公司指，儘管該
計劃列明發行人「shall not」(不得)在禁止買賣期內授出股份期權，但《GEM 上市規則》第
23.05 條在此方面從寬，與該計劃互相矛盾。因此，應以《GEM 上市規則》為準。
該公司又指，決定授股時尚未開始編備 2016 年首季業績，因此該公司並不知悉任何令其根
據《GEM 上市規則》第 23.05 條不得授股的內幕消息。
該公司亦指《GEM 上市規則》第 17.27B 條的字眼沒有要求月報表的資料須準確（及／或
完整），月報表只要按聯交所的格式填寫及適時呈交即可，《GEM 上市規則》第 17.27B
條並無規限報表的質素（此屬《GEM 上市規則》第 17.56(2)條的範圍）。
然而，該公司承認違反了《GEM 上市規則》第 23.06A、17.27A、17.56(2)及 6A.23 條。
陳先生及鄺先生承認違反《GEM 上市規則》第 5.01(1)、(2)及(6)條以及其《承諾》
陳先生及鄺先生承認違反了《GEM 上市規則》第 5.01(1)、(2)及(6)條，亦承認違反了其(i)
《盡力承諾》及(ii) 《竭力承諾》（沒有竭力促使該公司遵守《GEM 上市規則》）。
《GEM 上市規則》第 23.05 條「授予期權的時間限制」規定，發行人在得悉內幕消息後不
《GEM 上市規則》第 23.06A 條規定發行人根據期權計劃授出期權後，必須盡快刊發期權
《GEM 上市規則》第 17.27A(1)及(2)(b)條規定，發行人須不遲於在相關事件（其中包括根
開市前時段（以較早者為準）開始前 30 分鐘刊發翌日報表。
《GEM 上市規則》第 17.27B 條規定發行人在既定的時間內以既定的形式刊發月報表，當
《GEM 上市規則》第 17.56(2)條規定，依據《GEM 上市規則》規定而發出的所有公告或公
《GEM 上市規則》第 6A.23(1)條規定，在《GEM 上市規則》第 6A.01(4)條界定的指定期
違反《GEM 上市規則》第 23.05 條
《GEM 上市規則》第 23.05 條的標題清楚表明該條乃有關「授予期權的時間限制」。GEM
裁定《GEM 上市規則》第 23.05 條特別限制發行人在禁止買賣期內授出任何股份期權，而
有關該公司 2016 年首季業績的禁止買賣期由 2016 年 7 月 13 日至 2016 年 8 月 12 日。鑒
於該公司於 2016 年 7 月 22 日（禁止買賣期內）授出股份期權，GEM 上市委員會裁定該公
司違反《GEM 上市規則》第 23.05 條。
違反《GEM 上市規則》第 23.06A、17.27A、17.27B、17.56(2) 及 6A.23(1)條
反了相應的《GEM 上市規則》條文。該公司承認違反了下列《GEM 上市規則》條文：
(1) 《GEM 上市規則》第 23.06A 條：按該條規定，該公司應在 2016 年 7 月 22 日授股
後盡快公布詳情。但該公司在 2016 年 8 月 23 日（即授股逾一個月後）才公布授股。
(2) 《GEM 上市規則》第 17.27A 條：按該條規定，該公司應在 2016 年 8 月 23 日刊發
翌日報表，揭露相關承授人已於 2016 年 8 月 22 日行使股份期權並獲配發該等新發
行股份。但該公司在 2016 年 8 月 24 日才刊發翌日報表，比規定遲了一天。
(3) 《GEM 上市規則》第 17.56(2)條：按該條規定，所有公司公告及公司通訊在各方面
(i) 於 2016 年 8 月 5 日刊發的月報表；及
(ii) 分別於 2016 年 8 月 23 日及 24 日刊發的授股公告及內幕消息公告：兩份公
告當中，該公司未有披露 16 億股股份已於 2016 年 8 月 22 日根據股份期權
(4) 《GEM 上市規則》第 6A.23(1) 條：按該條規定，該公司應在刊發公告之前及時就授
2016 年 7 月 22 日批准授股，及至 2016 年 8 月 22 日才將授股公告草擬本送交天財
GEM 上市委員會裁定該公司亦違反了《GEM 上市規則》第 17.27B 條的規定，因為該公司
原應於 2016 年 8 月 5 日刊發的月報表中披露 18 億股股份期權及可根據股份期權發行的新
根據《GEM 上市規則》第 5.01 及 5.03 條，董事會須共同負責該公司的管理與經營業務，
GEM 上市委員會留意到相關董事指他們在批准授股前，於 2016 年 7 月 22 日董事會會議上
已考慮過《GEM 上市規則》第 23.05 條的涵義，尤其是鄺先生指他曾向公司秘書查問
(i) 授股符合該公司的利益；及(ii) 該公司當時尚未開始編備 2016 年首季業績，所以並沒有
上，直至 2016 年 8 月 18 日董事會商討要約人當天所公布的聲稱要約條款時，才知道該公
授股 — 違反《GEM 上市規則》第 23.05 條
GEM 上市委員會注意到，在 2016 年 7 月 13 日開始進入禁止買賣期後一個星期左右，相關
董事於 2016 年 7 月 22 日的董事會會議上批准授股，過程中沒有按《GEM 上市規則》第
授股，GEM 上市委員會遂裁定他們未有竭力促使該公司遵守《GEM 上市規則》第 23.05 條
授股公告 — 違反《GEM 上市規則》第 23.06A 條
GEM 上市委員會認為吳先生應該知道該公司沒有根據《GEM 上市規則》第 23.06A 條公布
授股一事，當他在 2016 年 7 月 25 日批准及簽立 2016 年 7 月 22 日的董事會會議紀錄、在
2016 年 7 月 27 日及 28 日及 8 月 8 日收到承授人接納授股的通知以及被口頭告知其他承授
排在 2016 年 7 月 22 日授股後盡快刊發公告，GEM 上市委員會裁定吳先生未有就授股竭力
促使該公司遵守《GEM 上市規則》第 23. 06A 條。
GEM 上市委員會亦認為黃先生及馬先生分別在 2016 年 7 月 28 日及 8 月 1 日批准及簽立
2016 年 7 月 22 日的董事會會議紀錄時，便應已知悉授股未有根據《GEM 上市規則》第
至少沒有在 2016 年 7 月 22 日的董事會會議上批准授股後，迅即主動向吳先生、公司秘書
能確保該公司根據《GEM 上市規則》第 23.06A 條盡快公布授股。GEM 上市委員會因而裁
守《GEM 上市規則》第 23.06A 條，與他們在《董事承諾》中表示會竭力行事的承諾不符。
GEM 上市委員會亦注意到，即使黃先生及所有獨立非執行董事聲稱自己在 2016 年 8 月 18
司秘書處理披露授股一事，但即使公布授股已遲了 27 日，直至 2016 年 8 月 22 日批准授
股公告草擬本時，二人也沒有向公司秘書或經理跟進。結果，授股公告在 2016 年 8 月 23
GEM 上市委員會因而裁定相關董事違反了《承諾》，沒有竭力促使該公司遵守《GEM 上市
規則》第 23.06A 條。
翌日報表及月報表 — 違反《GEM 上市規則》第 17.27A、17.27B 及 17.56(2)條
2016 年 8 月 5 日及 24 日刊發的月報表及翌日報表均是經他批准。
由於吳先生知道授股及該等新發行股份並牽涉其中，加上《GEM 上市規則》第 5.03 條的
(1) 《GEM 上市規則》第 17.27B 及 17.56(2)條，沒有在月報表中披露獲授股份期權及
(2) 《GEM 上市規則》第 17.27A 條，在 2016 年 8 月 24 日才刊發翌日報表。
於 2016 年 8 月 23 日及 24 日發布的授股公告及內幕消息公告 — 違反《GEM 上市規則》
GEM 上市委員會注意到，相關董事從八名承授人於 2016 年 8 月 20 日至 21 日通知該公司
們基於有關程序純屬行政性質的理由，在 2016 年 8 月 21 日董事會會議之後就沒有再向該
度後，已知悉或應已知悉 2016 年 8 月 22 日下午 4 時 37 分已發行股份一事。因此，在授
股公告草擬本及內幕消息公告草擬本於 2016 年 8 月 22 日下午 7 時 41 分及稍後時間送交
他們審閱時，吳先生應已知悉 16 億股股份已獲配發，從而知道授股公告草擬本及內幕消息
竭力促使該公司遵守《GEM 上市規則》第 17.56(2)條。
至於其他相關董事，GEM 上市委員會認為，承授人在電郵中的表述當可讓他們得知在 2016
年 8 月 21 日董事會通過股份配發之後，該公司或已發行了該等新發行股份。事實上，該等
新發行股份正是在之後一日下午 4 時 37 分發行。
因此，當授股公告草擬本及內幕消息公告草擬本於 2016 年 8 月 22 日下午 7 時 41 分及稍
重大方面均屬準確且無誤導成分。所以 GEM 上市委員會裁定，他們都違反了其《承諾》，
沒有就這兩份公告竭力促使該公司遵守《GEM 上市規則》第 17.56(2)條。
沒有諮詢合規顧問 — 違反《GEM 上市規則》第 6A.23(1)條
GEM 上市委員會注意到該公司沒有就(i) 授股；(ii) 該等新發行股份；及(iii) 授股公告（直至
2016 年 8 月 22 日）知會或諮詢天財資本，因為其已委聘希仕廷律師行為法律顧問及聲稱
公司諮詢其他專業顧問，亦不能免除其按《GEM 上市規則》第 6A.23 條(1)諮詢其合規顧問
諾》，沒有竭力促使該公司遵守《GEM 上市規則》第 6A.23(1)條。
相關董事違反《GEM 上市規則》第 5.01(1)、(2)及(6)條
其是下列責任：(i) 真誠為發行人整體利益行事；(ii) 為正當目的行事；及(iii) 審批授股時應
因此他們違反了《GEM 上市規則》第 5.01(1)、(2)及(6)條：
(1) 他們明知《GEM 上市規則》第 23.05 條及該計劃有明確禁限，但仍在沒有先諮詢合
(ii) 向承授人授出股份期權，但沒有設下任何行使條件去確保承授人在以 1 元的象
(iii) 其餘相關董事未有向公司秘書及／或負責《GEM 上市規則》合規事宜的經理
（2016 年 8 月 23 日才披露）令聲稱要約的對象起初並不包括股份期權持有人；
(4) 相關董事均知悉或應該知悉該等新發行股份已於 2016 年 8 月 21 日獲批准，但仍在
進度下，批准在 2016 年 8 月 22 及 23 日刊發授股公告及內幕消息公告，而該兩份
(5) 相關董事沒有就授股及授股公告草擬本，而促使該公司在 2016 年 7 月 22 日後盡快
諮詢合規顧問，直至 2016 年 8 月 23 日。
有以合理的技能、謹慎和勤勉確保該公司遵守《GEM 上市規則》第 17.27A、17.27B 及
17.56(2)條，違反了《GEM 上市規則》第 5.01(6)條。
吳先生違反《GEM 上市規則》第 5.20(1)條
GEM 上市委員會因而裁定，鑒於所有相關董事都違反了《GEM 上市規則》第 5.01(1)、(2)
及(6)條及吳先生違反了《GEM 上市規則》第 5.20(1)條，相關董事亦違反了其盡力遵守
(1) 該公司在一個月內接連違反《GEM 上市規則》，而違規的源頭是因為相關董事即使
知悉《GEM 上市規則》第 23.05 條及該計劃的限制仍在禁止買賣期內批准授出股份
(2) 承授人在禁止買賣期內獲該公司授出股份期權（但根據《GEM 上市規則》第 23.05
條及該計劃，這些股份期權本不應授出）後，其中八人在 2016 年 8 月 24 日及
2016 年 8 月 22 日行使股份期權的及時資料以及分別於 2016 年 8 月 23 日及 24 日
(4) 儘管該公司當時已按《GEM 上市規則》的規定聘請合規顧問，也即使該計劃有所
(5) 該公司在其呈述中對《GEM 上市規則》第 23.05 條的詮釋清楚顯示該公司及相關董
(6) 董事有責任確保公司不會在禁止買賣期內發行股份期權以違反《GEM 上市規則》及
(8) 聯交所就該公司在此事上違反《GEM 上市規則》收到三宗投訴（包括要約人的投
訴）。要約人在其 2016 年 9 月 2 日的公告中指，該公司未有在《GEM 上市規則》
規定的時間內披露授股損害了要約人的地位，令其在 2016 年 8 月 18 日公布聲稱要
(1) 譴責該公司違反《GEM 上市規則》第 23.05、23.06A、17.27A、17.27B、17.56(2)
(2) 譴責吳先生違反《GEM 上市規則》第 5.01(1)、(2)及(6)條及第 5.20(1)條，以及其
(3) 譴責其餘相關董事違反《GEM 上市規則》第 5.01(1)、(2)及(6)條以及其《董事承
諾》，沒有竭力促使該公司遵守《GEM 上市規則》及自身盡力遵守《GEM 上市規
《GEM 上市規則》第 6A.01 條，即任何根據《證券及期貨條例》持牌或註冊可進行
第 6 類受規管活動、根據其牌照或註冊證書可從事保薦人工作，並（如適用）根據
《GEM 上市規則》第 6A.19 或 6A.20 條獲委任為可從事合規顧問工作的公司或認可
(2) 吳先生、馬先生及現為聯交所其他上市公司董事的陳先生各自 (i) 完成由香港特許秘
事宜及董事職責的 24 小時培訓（包括 4 小時有關董事職責及企業管治的《GEM
上市規則》規定的培訓）（「培訓」）。培訓須於本新聞稿刊發起計 90 日內完成；
司董事，先決條件是其必須(i) 於有關委任生效日期之前完成培訓；及 (ii) 在培訓完成
: GS(14)@2019-03-13 07:44:42