After Muddy Waters attack, timber firm hit by Hong Kong regulator
Superb Summit International Group’s shares halted indefinitely
In a rare move, Hong Kong’s securities watchdog has ordered the trading of Superb Summit International Group’s shares to be halted indefinitely, over a year after US short-seller Muddy Waters alleged the company had fabricated almost all of its revenue in 2013.
The Securities and Futures Commission has “directed Hong Kong Exchanges and Clearing to suspend all dealings” in the shares of the coal and timber trader, under Section 8 of the securities and futures rules, Superb said in an exchange filing.
The SFC gave no reason and a spokesman declined to comment.
Trading of Superb’s shares has been suspended since November last year on Superb’s request to the exchange pending a clarification statement. The SFC’s trading ban means trading cannot resume even if the clarification is made, unless the whole SFC board agrees to it.
Superb issued a statement nearly two months after the Muddy Waters report was issued, saying the report contained “misleading statements and fabricated contents,” adding it would issue a statement to refute the allegations “in due course.” It never did.
“Section 8 has been used only in exceptional circumstances where there is a very clear-cut and serious case for investigation,” said Martin Rogers, a partner at international law firm Davis Polk.