Nine Dragons Paper (Holding) said yesterday it had received a proposal from Moody's Investor Services after Standard & Poor's dropped the scrap paper recycler's rating, causing its shares to plunge to a two-year low on Tuesday.
The company, founded by the world's richest self-made woman billionaire Zhang Yin, saw shares dip as much as 22 per cent after S&P announced its rating withdrawal on Tuesday. S&P pulled the rating on the grounds that it had failed to make contact with Nine Dragons' management since the beginning of the year.
But shares rebounded sharply after trading resumed yesterday afternoon, rising 13.8 per cent to close at HK$6.43.
'It's pretty bad that the S&P announcement was made during market hours,' said Kenny Tang Sing-hing, a general manager at AMTD Financial Planning.
'A lot of investors didn't really understand what was going on and so they thought it would be better to sell off their stakes,' Tang said. 'There is quite a bit of concern with the corporate governance of privately-owned mainland companies right now.'
In a statement filed with the Hong Kong bourse yesterday, Nine Dragons refuted S&P's claims, saying that it 'had not received any written information request from S&P to which it had not responded' and it 'was willing to co-operate with S&P and ready to respond to any information request from S&P for purposes of the rating, at any time'.
