Opinion | Lobbyist HKEx must learn the market still buys integrity
While the exchange operator has been a soft touch for Alibaba's PR push for exemptions to listing rules, it is now up to the SFC to hold the line
Your columnist was shocked to hear from sources at the highest level that Hong Kong Exchanges and Clearing has been lobbying on behalf of a potential listing candidate for special exemptions to the rules the exchange is supposed to help enforce.
It was no surprise to learn that the listing candidate was Alibaba, the mainland e-commerce company run by the charismatic teacher-turned-entrepreneur Jack Ma Yun that is set to bring a record-breaking listing to the market.
Alibaba, the bankers and others hoping to get in on what could be the world's biggest initial public offering (IPO) of shares this year are obviously keen to get the deal done, given the listings drought Hong Kong is currently suffering.
But is that a good enough reason to start tearing out the bits of the Hong Kong regulatory rule book that inconveniently stand in the way of the corporate structure that Ma wants to preserve, which would ensure the 10.4 per cent stake he and his management team own in the firm equates to effective control of the board?
Which are the troublesome bits? Well first, there's the Takeover and Mergers Code.
Alibaba - according to sources close to the firm - wants to preserve a partnership structure that has been in place since 2009 which would give Ma and a group of around 20 top executives the right to nominate a majority of candidates for the company's board.