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Parkview up 420pc on office sale speculation

Hong Kong Parkview Group, which has interests in mainland property development, nearly tripled in trading yesterday after hinting at an impending major transaction.

Its shares have surged nearly six-fold in the past two days, climbing 420 per cent to HK$2.86.

Hong Kong Parkview suspended trading on Thursday afternoon but resumed yesterday, announcing that it was finalising the terms of a major potential acquisition and disposal. Investors speculated that the impending disposal might be related to coveted office space linked to the company in the World Wide House complex in Central.

Hong Kong Parkview does not directly control an office in World Wide House, but its controlling shareholder, the Hwang family, does have a property there, according to a source with knowledge of the company. 'The market is buying on hope that if they sell down the office in World Wide House they may make a special dividend,' said Kenny Tang Sing-hing, an executive director at Redford Asset Management.

Henderson Land recently fetched over HK$250 million for an office floor at the building, according to reports.

Hong Kong Parkview posted a HK$15 million loss for the year ended March 31 this year, following a HK$37.5 million shortfall in the previous year. It has a market capitalisation of HK$1.5 billion, according to Bloomberg data.

The company was established in the 1980s by the late Taiwanese businessman Hwang Chou-shiuan. Its first project in Hong Kong was the luxury residential project, Hong Kong Parkview, in Tai Tam Country Park.

The company has since shifted its focus to the mainland property market, developing a hotel in Nanjing and residential projects in Shanghai.

Hong Kong Parkview is just the latest little-traded stock to catch fire in the local market.

Department store operator Sincere Company surged 69.8 per cent through the first three days this week.

'Right now, speculation is pretty aggressive on these kinds of stocks,' said Linus Yip, a strategist at First Shanghai Securities.

'There may actually be no reason [for speculation] or investors just take some news as an excuse and push the share up.'

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