Forbes reported today:
Hong Kong court of appeal topples tycoon Richard Li's $2.1 billion buyout bid.
Richard Li Gets Denied On PCCW
Tina Wang April 22, 2009.
Hong Kong seen in better light ©2008 Am Ang ZhangPCCW is Hong Kong's biggest fixed-line telecom operator.
“The three-member Hong Kong Court of Appeal overturned a lower court's ruling in favor of. ……Hong Kong's Securities and Futures Commission has accused Li of rigging a shareholder meeting by handing out shares to new investors so that they can participate in the shareholder vote on the buyout.”
“A plan by Li, who is the son of the world's 11th richest billionaire Li Ka-shing, to pay himself and Beijing-backed partner
“Earlier this week, a judge on the appeal court, Anthony Rogers, called this scheme ‘outrageous.’ He also suggested that Li's buyout plan takes advantage of minority shareholders, who have been hurt by the dramatic fall in PCCW's share price, from over 120 Hong Kong dollars ($15.48) to over 2 Hong Kong dollars over most of the last decade.”
"A regulation intended to protect minority shareholders, Hong Kong law says a buyout can be approved if a majority of shareholders, regardless of how much stock they own, other than the buyout partners, vote in favour of the deal. Theoretically, majority investors seeking to privatize a company can split their shareholdings among new investors. Hong Kong regulators say that hundreds of insurance agents at Fortis' Hong Kong unit, once controlled by Li, were handed PCCW shares in exchange for votes. The court's decision may boost some momentum for reform of the market regulations that has been discussed for years.”
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