Sega eyes backdoor entry
Japan-based video game-maker Sega Enterprises is in talks to buy into Cheong Ming Holdings in a bid to gain a backdoor listing in Hong Kong, according to sources.
The move would help Sega expand and diversify in the Greater China region, analysts said.
Cheong Ming makes paper cartons and packaging boxes.
With a market capitalisation of about US$4.6 billion, Sega is a leader in interactive entertainment.
In Tokyo yesterday, Sega's share price shed 1.4 per cent to close at 4,040 yen (about HK$291.20).
Trading in Cheong Ming's shares was suspended on Monday morning after the counter surged 24 HK cents - or 33 per cent - to 97 cents.
Cheong Ming said it was 'pending an announcement regarding a possible notifiable share transaction'.
Sega is not the only company to express an interest in Cheong Ming, according to sources.
Cheong Ming had almost concluded a takeover deal with an unnamed firm, but Cheong Ming called it off after Sega appeared, they said.
If the takeover is finalised, Sega would become the third Japanese company to gain a backdoor listing in Hong Kong in the past two months.
Last month, Softbank - Japan's largest Internet investor - agreed to buy a 61.5 per cent stake in Cheung Wah Holdings.
This led to a fivefold increase in Cheung Wah's share price, which has been maintained.
In December, Hikari Tsushin - Japan's second-largest Internet investor - agreed to buy 55 per cent of Golden Power International Holdings.
Golden Power's share price more than doubled on the news, and has surged more than threefold since then.
