The insider dealing tribunal has found 11 people guilty of illegally trading Vanda Systems & Communications Holdings shares before a deal with Hutchison Whampoa in 2000, the biggest number of insiders named in a single case.
The insiders included Vanda's co-founder Lam Hon-ham, general manager Ernest Choy Ming-yan and Sammy Tse Kwok-fai, the chief executive of Hutchison E-Commerce, a wholly owned unit of Hutchison.
The tribunal said the three told their associates there would be a sale of convertible bonds by Vanda to Hutchison in February 2000 before the public announcement, allowing them to make gains from trade in Vanda shares.
According to a Vanda announcement on February 22, 2000, the company would sell a 28 per cent stake to Hutchison and the Li Ka-shing Foundation through the issue of convertible bonds and share options. Vanda and Hutchison also planned to form a joint venture in online payment systems.
Vanda shares jumped to HK$8.60 after the announcement, before closing at HK$7.95, a 39 per cent increase from the last quoted price of HK$5.70 before trading was suspended on February 18.
Also found guilty were Lam's sister-in-law Silvia Chan Yuk; Choy's wife Becky Chan Lai-king; and Tse's friends Debbie Ng Kit-ying, Dennis Li Yat-tung, Christie Wo Man-shan, Chris Wong Cheung-hung, Charles Chong Wai-lee and Becky Chong Bun-bun.