Red-chip Founder Holdings is a software-development and systems integrator for the publishing, banking and retail industries and distributes computers throughout the mainland.
The company supplies Chinese software to more than 90 per cent of the newspapers in the mainland.
In a recent report by Core Pacific-Yamaichi, Founder's net loss for the first half of this year was HK$54.5 million, narrowed from a loss of HK$120 million for the same period last year.
Despite a gradual recovery and a massive reduction in staff levels, Core Pacific said the improvement appeared to come only from its non-media sector, while the media sector deteriorated slightly.
It also had concerns over the higher level of lay-off compensation.
'We tend to remain cautious about an immediate turnaround as the company experienced severe losses last year,' Core Pacific said in its report.