Li Hejun, chairman and CEO of Hanergy Group
Hong Kong’s securities watchdog took the unusual step yesterday of ordering a stock trading suspension to remain in place for a Chinese solar panel maker it’s investigating after a plunge wiped out half its market value.
Hanergy Thin Film Power Group, controlled by Chinese billionaire Li Hejun, said in a filing that the Securities and Futures Commission directed Hong Kong’s stock exchange to “suspend all dealings” in the shares.
Shares of Hanergy, a unit of Beijing-based Hanergy Holding Group, had been suspended since May 20 at the request of the company after the price plunged by nearly half in the first hour of trading, erasing about USD19 billion from the company’s market capitalization.
The suspension order means the shares cannot resume trading even if the company requests it.
Hanergy’s spectacular rise and fall has bewildered Hong Kong’s investment community. The crash came after the shares had surged sixfold over the previous year, making Hanergy founder Li one of the richest people in China, but also raising concern that the stock had risen too fast.
In an interview with Chinese state media a week after the stock crash, Li denied reports that the company was being investigated, saying they were “purely a rumor.” A day later, the SFC made the rare revelation that it was carrying out a formal investigation into Hanergy’s affairs. The watchdog’s investigations are usually kept secret.
Under its rules, the SFC is allowed to order suspensions if it decides that “any material false, incomplete or misleading information” has been provided in documents issued by the company.
The regulator has issued such an order only a handful of times in recent years and the move could indicate its investigation is moving into a more serious phase.
In one high-profile case, the SFC ordered sports clothing fabric maker Hontex International Holdings Co. to halt trading just three months after its initial public offering in December 2009 for providing misleading information in its prospectus. The shares were later delisted. Kelvin Chan, Business Writer, Hong Kong , AP
No Comments