When someone shares with you something of value, you have an obligation to share it with others.
Saturday, 1 November 2008
Citic Pacific Suspended After Shares Surge
Trading in shares of Citic Pacific has been suspended after they rose by more than a quarter amid speculation its parent company will inject additional capital to cover losses on currency contracts or take over the contracts itself.
Trading in shares of Citic Pacific has been suspended after they rose by more than a quarter amid speculation its parent company will inject additional capital to cover losses on currency contracts or take over the contracts itself.
“There were rumours circulating in the market that Citic Group, its state-owned parent, will inject cash to boost Citic Pacific’s capital and improve its cash flow,” said Kenny Tang Sing-hing, director of Tung Tai Securities.
There was also speculation the parent would assume Citic’s soured currency contracts - on which the company has predicted it may lose HK$15.5 billion - Mr Tang said.
“That’s why the stock bucked the fall in the overall market, even though mainland newspapers reported that securities watchdogs were also launching a probe into the company,” he said.
Citic Group, the mainland’s biggest state-owned investment company, has already pledged to help arrange a US$1.5 billion standby loan to Citic Pacific.
Shares in Citic Pacific shot up 27.8 per cent, to HK$6.39, yesterday but closed up 21.2 per cent at HK$6.06 before trading was suspended pending a statement.
The Hang Seng Index lost 361.18 points, or 2.5 per cent, yesterday to close at 13,968.67.
Citic Pacific is in talks to sell all or part of its 56.67 per cent stake in Dah Chong Hong Holdings. Shares in Dah Chong Hong rose 19.82 per cent to HK$1.33 yesterday.
Ratings on debt issued by Citic Pacific were cut and its share price plummeted after the company disclosed on October 20 that it might lose as much as HK$15.5 billion on unauthorised currency bets by its finance director on the Australian dollar.
Hong Kong’s stock exchange and the Securities and Futures Commission are investigating the company for delaying an announcement about its massive losses for six weeks, and some critics have suggested insider trading may have been involved.
Mainland newspaper China Business News yesterday quoted a senior Citic Group executive as saying that the China Securities Regulatory Commission (CSRC) had launched a joint investigation with the SFC into Citic Pacific and that the results would be issued soon.
A spokesman for the SFC said it did not comment on individual cases. The CSRC could not be reached for comment.
However, sources close to the SFC said it did not launch a joint investigation with the CSRC into Citic Pacific. Cable TV, citing a spokesman for Citic Group, also denied the report.
Secretary for Financial Services and the Treasury Chan Ka-Keung said he believed the incident would not affect Hong Kong’s reputation as a financial centre.
1 comment:
Citic Pacific Suspended After Shares Surge
Carol Chan
1 November 2008
Trading in shares of Citic Pacific has been suspended after they rose by more than a quarter amid speculation its parent company will inject additional capital to cover losses on currency contracts or take over the contracts itself.
“There were rumours circulating in the market that Citic Group, its state-owned parent, will inject cash to boost Citic Pacific’s capital and improve its cash flow,” said Kenny Tang Sing-hing, director of Tung Tai Securities.
There was also speculation the parent would assume Citic’s soured currency contracts - on which the company has predicted it may lose HK$15.5 billion - Mr Tang said.
“That’s why the stock bucked the fall in the overall market, even though mainland newspapers reported that securities watchdogs were also launching a probe into the company,” he said.
Citic Group, the mainland’s biggest state-owned investment company, has already pledged to help arrange a US$1.5 billion standby loan to Citic Pacific.
Shares in Citic Pacific shot up 27.8 per cent, to HK$6.39, yesterday but closed up 21.2 per cent at HK$6.06 before trading was suspended pending a statement.
The Hang Seng Index lost 361.18 points, or 2.5 per cent, yesterday to close at 13,968.67.
Citic Pacific is in talks to sell all or part of its 56.67 per cent stake in Dah Chong Hong Holdings. Shares in Dah Chong Hong rose 19.82 per cent to HK$1.33 yesterday.
Ratings on debt issued by Citic Pacific were cut and its share price plummeted after the company disclosed on October 20 that it might lose as much as HK$15.5 billion on unauthorised currency bets by its finance director on the Australian dollar.
Hong Kong’s stock exchange and the Securities and Futures Commission are investigating the company for delaying an announcement about its massive losses for six weeks, and some critics have suggested insider trading may have been involved.
Mainland newspaper China Business News yesterday quoted a senior Citic Group executive as saying that the China Securities Regulatory Commission (CSRC) had launched a joint investigation with the SFC into Citic Pacific and that the results would be issued soon.
A spokesman for the SFC said it did not comment on individual cases. The CSRC could not be reached for comment.
However, sources close to the SFC said it did not launch a joint investigation with the CSRC into Citic Pacific. Cable TV, citing a spokesman for Citic Group, also denied the report.
Secretary for Financial Services and the Treasury Chan Ka-Keung said he believed the incident would not affect Hong Kong’s reputation as a financial centre.
Post a Comment