OpinionHontex International investors agree on HK$1b refund
Most small stakeholders vote to return shares to the sport fabric maker at its last trading price after SFC's claims of misleading IPO data
Shareholders of sport fabric maker Hontex International have approved its HK$1 billion buy-back of shares issued from its troubled 2009 initial public offering.
Chen Fang-kun, independent non-executive director at the company, said 99.3 per cent of participants at an extraordinary shareholder meeting yesterday gave the green light to the repurchase scheme.
Hontex will pay HK$1.03 billion, or HK$2.06 per share, to buy back all the shares owned by the 7,700 small shareholders, who either subscribed for the IPO or bought after the listing. The offer is equal to its last trading price.
In June, a Hong Kong court ordered the company to refund money to small shareholders after the Securities and Futures Commission alleged it had provided misleading information by overstating its profit and turnover figures in its listing prospectus in 2009. The move marks the first time the regulator has sought compensation for investors.
Hontex, founded and chaired by Taiwanese Shao Ten-po, runs a factory in Fujian. It listed on Christmas Eve 2009 but the SFC suspended it from trading in March 2010, meaning it has traded for only 64 days.
Shao did not attend yesterday's meeting, which was hosted by Chen and fellow independent non-executive director Lu Chien-an. "Hontex is still running normal business operations. We have done our best to protect the interest of small shareholders," Chen said.