WILLIAM Cheng Kai-man was ''severely condemned'' and ''severely censured'' for his conduct in an acquisition of Shun Ho Resources shares in 1988 by a panel of the Securities and Futures Commission (SFC). This could cost Mr Cheng about $50 million, as the SFC takeovers panel told him to compensate all holders of Shun Ho shares and warrants for his failure to make a general offer as then required by the code. This compensation amounts to 65 cents per share and 31 cents per warrant to shareholders in the group on November 30, 1988. The effect of the compensation would be to place the shareholders in the position they would have been in had a general offer been made. Mr Cheng has been given three months to consider whether he is prepared to make compensation, otherwise the panel will consider making a ''cold shoulder'' order against him. ''A cold shoulder order is the most severe sanction available under the current code. ''Its effect would be that the services of dealers and advisers, including brokers and merchant banks, would be withheld from Mr Cheng for the period of the order.'' Mr Cheng indicated that he was unwilling to make compensation on the basis outlined by the panel, but would pay a sum to the Compensation Fund. The panel regarded this offer as irrelevant. The panel's decision indicates it will consider a cold shoulder order at the end of three months if Mr Cheng remains unwilling to meet the code obligation as directed by the panel. The panel's enquiries stem from a complaint made in September 1990, that a share transaction appeared to take Mr Cheng above the 35 per cent general offer trigger point as laid down by the code. In October, after investigations, the panel concluded that Mr Cheng was acting in concert with another party to consolidate control over Shun Ho in November 1988. This contravened a rule by failing to make a general offer.