New | Synertone shares jump after stake deal with US fund
Shares in Synertone Communication Corp jumped 20 per cent at the start of trading in Hong Kong on Monday after the satellite operator announced a unit of Franklin Templeton Investments was buying into the company.
The company would issue new shares to the United States-based investor at 67.79 HK cents each, totalling HK$273.5 million, it said in a filing to the stock exchange on Monday. The issue represents 6 per cent of the firm’s enlarged issued capital.
The stock surged 20 per cent from its trading price on Thursday after opening at 82 HK cents on Monday, while the Hang Seng Index dropped 0.5 per cent. It was suspended on Friday.
On Friday, Synertone said the company and chairman Wong Chit-on had entered into a memorandum of understanding for the share issue with the fund managed by Templeton Asset Management’s Emerging Markets Group.
The price for the issue represents a discount of 0.31 per cent to the closing price of 68 HK cents on Thursday.
In mid-morning on Monday, the stock traded at 76 HK cents, up 8.6 per cent, as the benchmark index’s decline widened to 0.75 per cent.
Synertone said proceeds from the share sale would be used mainly to support the company’s proposed construction of its Synertone 2 communication satellite.
The company said the new satellite would “substantially generate more satellite bandwidth resources” to meet growing demand in China.
