Holders of Chinese Estates stock left none the wiser
Even as the stock market hammered its shares, Chinese Estates Holdings' annual shareholders' meeting yesterday took only 15 minutes and never addressed the cloud hanging over the firm.
Its stock price fell 7.4 per cent when it resumed trading, but executives said nothing to shareholders about the implications of the corruption trial its chairman and chief executive, Joseph Lau Luen-hung, faces in Macau.
That alarmed lawmaker Chim Pui-chung of the financial services sector, who urged the Securities and Futures Commission to investigate whether Chinese Estates was disclosing enough information to its shareholders.
The company's shares, which were suspended from trading on Thursday, closed at HK$9.09 yesterday against Wednesday's close of HK$9.82.
Lau and tycoon Steven Lo Kit-sing have been charged with bribery and money laundering related to the purchase of five plots of land opposite Macau airport.
The deal was allegedly approved by disgraced former Macau public works chief Ao Man-long after the Hongkongers paid him HK$20 million.
There were significant absences from yesterday's very brief annual general meeting.
Joseph Lau, his younger brother Thomas Lau Luen-hung and Joseph's son Lau Ming-wai, the company vice-chairman, did not attend.
They missed the meeting 'due to other business reasons', a company spokeswoman said.
During the meeting, shareholders said later, nobody from the company explained to them the impact the case would have on the firm, and no shareholders asked for information.
Joseph Koo, 60, who has held Chinese Estates shares for more than 10 years, said he was worried about the company's future and was surprised by Lau's prosecution.
'Everybody is worried when you are involved in something like this,' he said. 'It is happening; it is a court case now. I cannot tell what will happen.' Koo said he might consider selling his shares.
Another shareholder, Leung Pak-kin, 82, said the meeting went off routinely despite the unusual circumstances.
'We are not clear about the case. We wanted to ask, but we had no idea how to ask,' he said.
Chim, the lawmaker, said the company should disclose the estimated loss it and small shareholders would face if the Macau government took action against the firms' investment in Macau.
'The SFC and the stock exchange have a duty to require all listed companies to make sufficient disclosure on cases like that so as to safeguard the interests of the small shareholders of Chinese Estates,' Chim said.
Edward Chow Kwong-fai, deputy chairman of the Business and Professionals Federation, said: 'Generally speaking, when anyone is involved in any legal cases, they would consider distancing themselves from the company's major decisions or daily operations. It's not mandatory corporate governance but could be seen as good practice to strengthen the confidence of investors.''
A Hong Kong Exchanges and Clearing spokesman declined to comment on the case.
Meanwhile, Lau's co-accused, Lo, declared his innocence yesterday.
'I deny the allegations. There is insufficient evidence,' he said, refusing to elaborate.
Lo, the chairman of BMA Investment, said he had not been formally notified by the public prosecutions office that he was charged, but was now looking for a lawyer.