Oung brothers a step closer to cementing control of Paladin
Convertible note issued by majority Paladin shareholder opens door to debt-for-equity swap
A convicted fraudster and his fugitive brother moved a step closer to cementing their control over Hong Kong listed Paladin through a convertible note offer that values the company at a fraction of its book price.
It is the latest stratagem by rival family claimants already estranged over the alleged misuse of their matriarch's estate and abuse of a paralysed stroke victim's power of attorney document.
A HK$127.2 million secured exchangeable convertible note issued late September by majority Paladin shareholder Cityguard Holdings to British Virgin Island firm Next Level opens the door to a debt-for-equity swap that moves control over Paladin one step further away from competing family members who claim to have been cheated.
Next Level is controlled by brothers Andrew and James Oung Da Ming, sister Margaret Uon, and Anglo Chinese Nominees, as trustees for another BVI entity called Basurto Holdings.
Represented by former Paladin chief executive, Michael Chen Te-kuang, nephew of the Oung brothers, aggrieved family claimants question whether fraud and abuse of stock exchange rules have taken place, charges denied by Stephen Clark, Anglo-Chinese managing director, and adviser to the Oung brothers.
"I certainly do not think either we or our clients are engaging in a fraudulent activity," said Clark, who is also chairman of the Securities and Futures Commission Takeovers and Mergers panel. A highly complex multi-tiered offshore corporate structure masks one of the stock market's more colourful episodes of alleged financial chicanery, which at one point saw rival parties jostling to speak for Paladin via conflicting stock exchange announcements and newspaper advertisements.
