The firm wants its main shareholder to be exempt from triggering takeover
The Securities and Futures Commission (SFC) has turned down an application from CLP Holdings for a rule interpretation exempting its major shareholder, the Kadoorie family, from making a general offer.
The decision means that if the electricity supplier repurchases 11 million shares, the Kadoorie family will cross the 35 per cent general offer threshold and would have to make a mandatory general offer to buy all shares from smaller shareholders.
A CLP spokesman said it was disappointed by the SFC panel's decision.
'There is still room to repurchase shares in the near term, but we are still studying a long-term plan on our share-repurchase programme. We believe that obtaining a waiver is in the interest of the company and its shareholders, and is in line with practices in other jurisdictions that CLP, and indeed Hong Kong, benchmarks against, notably the United Kingdom, Australia and Singapore,' he said.
The SFC said the takeover panel decided the takeover code should not be interpreted so as to permit whitewash applications in respect of mandatory bid obligations triggered by on-market share repurchases.
