Activist David Webb has called on independent shareholders of toymaker RBI Holdings to vote down the company's HK$63.6 million fund-raising plan at a meeting next week as he said the price was not fair to investors.
In response, an RBI spokesman said the company would respect the voting decision of its independent shareholders at the special general meeting on June 4.
RBI proposed an open offer last month of four new shares for every share held at 10 HK cents each to raise HK$63.6 million.
The offer, underwritten by Kingston Securities, prices the shares at a deep discount of 86.1 per cent, compared with 72 HK cents before the offer was announced.
Mr Webb said in his webb-site.com the discount was not fair as an open offer meant investors who do not want to take up the offer cannot sell the entitlement in the market.
In London, listing rules curb the discount on the price of an open offer to 10 per cent to protect shareholders from losing out due to the diluted effect if they do not take up the entitlement.
'Hong Kong has no such limit. Shareholders have a gun to their heads - either take up their entitlements or get diluted by 400 per cent at a massive discount,' Mr Webb wrote. 'Nor can they apply for the entitlements not taken up by others - that benefit goes to the underwriter.'
