China Innovative Finance Group Limited 中國新金融集團有限公司

NetMind (0985) sells 8.66% of CIFG (0412) for HK$598.44m
Disclosure of interest, 8-Dec-2016
The off-market transaction, on 5-Dec-2016, was for cash at $0.36 per share, a 39% discount to the closing price of $0.59. The consideration was 24.31% ot NetMind's market capitalisation of $2461m at the average price over the preceding 5 days, so in our view, it was a Discloseable Transaction under the Listing Rules, which NetMind has failed to announce. Both companies are in what we call the "Chung Nam Network".
Enterprise Development (1808) coughs up investment details at 30-Jun-2016 and 31-Dec-2015The Joint Global implosion
Company announcement, 30-Nov-2016
This follows a complaint by Webb-site to HKEX on 4-Sep-2016. The announcement hints at what happened to Joint Global Ltd, featured in our article "The Joint Global implosion". During the first half of 2016, JG disposed of its entire 26.96% shareholding in HEC Capital Ltd for an undisclosed price and had incurred a cumulative loss of HK$1978m by 30-Jun-2016, reducing its net assets from HK$2130m to just $132m, including a 5-year promissory note of $131m.
Mason (0273) sells Willie Link Ltd for HK$400m
Company announcement, 4-Nov-2016
This was done in 2 blocks. 45% was sold in Mar-2016 to Apex Corporate Investments Ltd for HK$200m, and 55% now to Best Mate Ltd, owned by Kenneth Chan Chak Kai, for HK$200m. Mason fails to say who owns Apex. We can tell you that it was once owned by CIFG (0412) which sold it to High Rhine Ltd (BVI) on 20-Nov-2014. According to Mason's 2015 accounts, it acquired High Rhine in Jun-2015.
CIFG (0412): breach of Listing Rules on Discloseable TransactionsThe Jont Global implosion
Company announcement, 26-Oct-2016
Following our article on 30-Sep-2016, CIFG admits that it swapped its 56.8m HECC shares for shares in JG and this was a Discloseable Transaction. It also claims that on 1-Apr-2016, the day after CIFG's year-end, it agreed to transfer its JG shares to New Peak Ltd (BVI), the owner of which is not disclosed, and in consideration received 48m shares in HECC, the transferor of which is not disclosed, thereby avoiding the JG implosion. This transaction was not completed until 30-Jun-2016. It was not disclosed as a post-balance sheet event in CIFG's accounts.
SFC warns market on CIFG (0412)
Following Webb-site's bubble warning on 26-Sep-2016, the SFC has conducted an ownership investigation. (13-Oct-2016)
Hiding behind the cornerstones
Webb-site reveals that investors who took 31% of a bank IPO had secretly laid off their risk by issuing derivatives to a mainland property developer from the same city, via two HK-listed companies which incidentally are bubble stocks. When we complained, HKEX did not require disclosure of the bank’s identity, thereby preserving the secrecy behind the cornerstone investors which facilitate HKEX’s IPO business. Once again, the regulatory conflict of interest is exposed. (3-Oct-2016)
The Joint Global implosion
A collapse in a hub of the "Chung Nam Network" has wiped about HK$2bn off the balance sheets of at least 11 listed companies, many of which never announced that they had invested in it. We piece together an ugly jigsaw and call on the SFC to investigate and HKEX to wake up and require announcements. (30-Sep-2016)
China Innovative Finance (0412) bubble
Hao Tian Development (0474) has confirmed our view by dumping 9.06% of CIFG at a 61.9% discount, still well above the net tangible asset value of $0.099. CIFG should trade below NTAV due to its appalling governance and membership of what we call the "Chung Nam Network". The purported profits of its leasing division are largely illusory and depend heavily on 1 customer in which CIFG has invested. HTD has also been allowed by HKEX to skirt the Listing Rules on corporate transactions. (26-Sep-2016)
China Inno Fin (0412) belatedly details investments at 31-Mar-2016
Company announcement, 13-Jul-2016
This follows a complaint by Webb-site to SEHK. The firm held 9.95% of China Smarter Energy (1004), 4.49% of Huarong (0993) and 1.34% of Carnival (0996), as well as having sunk HK$340.8m into Joint Global Ltd, the newest unlisted hub in what we call the "Chung Nam Network". It provides no details of this significant investment, which in our view should have been announced when made.
China Opto (1332) discloses the junk held by Win Wind Capital Ltd
Company announcement, 28-Jun-2016
This follows a complaint filed by Webb-site on 23-Jun-2016 that the Major Transaction circular, which was presumably vetted by the Stock Exchange, failed to include any information on the underlying investments held by Win Wind Capital Ltd, with which China Opto is engaged in a share swap. Several of the stocks are in what we call the "Chung Nam Network".
GT (0263) belatedly discloses what it held at 30-Jun-2015
Company announcement, 26-Nov-2015
All of the 5 identified shareholdings are in listed companies in what we call the "Chung Nam Network", as is GT.
Enterprise Development (1808) belatedly discloses what it held at 30-Jun-2015
Company announcement, 24-Nov-2015
All 3 disclosed holdings are in HK-listed companies in what we call the "Chung Nam Network", as is Enterprise Development.
Pass the parcel: Willie (0273) buys basement of China United Centre from HEC Capital for HK$170m
Company announcement, 20-Apr-2015
Avoiding 8.5% double stamp duty, Willie is buying the BVI company which indirectly owns the property. It was previously owned by Dragonite (0329) until 21-Jan-2014, by Heritage (0412) until 4-May-2011 and by Z & Z International Ltd until 25-Apr-2008. Even earlier, it was owned by China United Holdings Ltd, the former incarnation of Willie, which bought the property in 1997 for HK$470m. So it has now come full circle. All are in the "Chung Nam Network"
Putting the FRC in Farcical
In a shocking failure to recognise a basic and obvious accounting and auditing error, HK's Financial Reporting Council rejected our complaint. The listed company involved has now admitted the error. We call on the FRC's Process Review Panel to investigate how it deals with complaints. (16-Apr-2015)
The bubbles in CNN
We warn investors of 3 bubbles amounting to HK$20.0bn (US$2.58bn) in the "Chung Nam Network" of listed companies, Heritage (0412), Rising Dev (1004) and Mascotte (0136) and look at a blatantly bad decision by the board of Hao Tian (0474), and an undisclosed Very Substantial Acquisition by that company. One of the bubbles is even a Russian doll "double bubble" - one owns the other. (8-Jan-2015)
Heritage (0412) sells loss-making TCM clinic
Company announcement, 5-Nov-2014
The purchaser is High Rhine Ltd, the owner of which is not disclosed. On 12-Dec-2013, High Rhine Ltd was sold by Tack Fiori (0928) to Equal Sky Ltd (BVI), which at least until 21-Apr-2010 was owned by Willie (0273). So this may have been a sale to Willie.
CST Mining (0985) buys 210m shares (4.96%) of Heritage (0412)
Disclosure of interest, 5-Nov-2014
The off-market purchase at HK$2.00 costs $420m and increases its stake to 9.81%.
Subscription agreement between Hao Tian (0474) and HEC Capital Ltd dated 18-Sep-2012
Company filing, 2-Jul-2014
This is a recent filing under the Takeovers Code. Schedule 1 reveals the shareholdings in HEC Capital Ltd on the subscription date, including 10 other listed companies which we consider to be in the "Chung Nam Network".
Heritage (0412) subscribes HK$228m for 4.08% of HEC Capital Ltd
Company announcement, 12-Jun-2014
Heritage (0412) buys Hebei forestry rights for HK$800mCircular
Company announcement, 5-Oct-2012
The ownership of the BVI vendor is not disclosed.
Heritage (0412) buys forestry interests from Forefront (0885) for HK$50mForefront announcement.
Company announcement, 8-Jun-2012
Pass the parcel: Forefront bought this from Mascotte (0136) for $79.2m in shares in 2010, and Mascotte bought this from Willie (0273) for $130m in convertible bonds in 2009. All 4 companies are in what we call the "Chung Nam Network".
Heritage (0412) cancels share option
Company announcement, 30-Apr-2012
The Company still doesn't say who the grantee was, but see our comment on the announcement of 20-Apr-2012.
Heritage (0412) issues shares to Peter Liu On Bong, grants 10-year options
Company announcement, 20-Apr-2012
The subscriber is Vice Chairman of Tack Fiori (0928) and former MD of Radford Capital (0901). All 3 companies are in the "Chung Nam Network". The grantee of the options is not named, but the number of options just happens to be exactly 1/3 (rounded down) of the number of subscription shares. Could it be that the subscriber is also the grantee?
Dragonite (0329) buys basement of China United Centre from Heritage (0412), does placingHeritage announcement
Company announcement, 6-May-2011
The Dragonite placing is via Chung nam Securities Ltd. Both listed companies are in what we call the "Chung Nam Network".
Heritage sells 19.75% of money-lending unit to Hennabun
Company announcement, 4-Jan-2011
Willie (0273) lends HK$65m to Double Smart Finance
Company announcement, 22-Oct-2010
DSF is a loss-making money-lender which is owned by Best Purpose Ltd, which is 47.5% owned by Willie and 47.5% owned by Heritage (0412)
Chairman of Heritage (0412) subscribes shares in Forefront (0885)
Company announcement, 27-Apr-2010
China Strategic bubble
We warn investors of a bubble in the stock of China Strategic, the 80% owner of the proposed buyer of Taiwan's Nan Shan Life Insurance, partly financed by a massive note issue convertible into 78bn shares at $0.10 each. We publish the placing list and analyse the names in the deal. Finally, we warn investors to avoid 7 companies in the "Chung Nam network", which has lost HK$6.2bn in 5 years. (13-Nov-2009)
Willie sells rest of Mascotte convertible bond to Heritage for HK$45mHeritage announcement
Company announcement, 17-Aug-2009
Heritage and Neptune swap $100m of convertible notesNeptune announcement
Company announcement, 16-Jul-2009
Heritage sells half its money-lending unit to Willie for convertible notesWillie announcement
Company announcement, 11-Jun-2009
Radford places shares with Vincent Wong Chun Hung, a director of Heritage, a substantial shareholder
Company announcement, 5-Jun-2009
The paid advert opposing the blackout rule
With links to the signatories in Webb-site Who's Who. (29-Dec-2008)
Heritage accepts convertible bond from Radford in settlement of HK$25m loanRadford announcement
Company announcement, 26-Sep-2008
Willie issues shares to Heritage to terminate $86.9m convertible noteHeritage announcement
Company announcement, 17-Sep-2008
Heritage sells floors 30-32, China United Centre to Willie for HK$86.6m convertible noteWillie announcement
Company announcement, 20-May-2008
Heritage (0412) buys basement of China United Centre
Company announcement, 29-Apr-2008
Inner Mongolia Development buys 53.8m shares (6.18%) of Hennabun from Heritage for shares
Company announcement, 12-Jun-2006
Qualipak sells 30th floor, China United Centre, to Heritage for $49mHeritage announcement
Company announcement, 31-Mar-2006
Heritage issues shares to Ingrid Kwok Wai Ming, ED of Freeman
Company announcement, 8-Mar-2006
Company prosecuted for breach of SFO
Company announcement, 13-Feb-2006
SFC prosecutes Heritage International Holdings Ltd for disclosure failures
SFC, 10-Feb-2006
Heritage "independent shareholders" veto acquisition of House A, Sunshine Villa from Karen Lo Ki Yan by 99.64%
Company announcement, 7-Nov-2005
Heritage conditionally agrees to buy House A, Sunshine Villa from Karen Lo Ki Yan for $73.8m with $35m deposit
Company announcement, 2-Aug-2005
Heritage (0412) buys Units 5 & 6, G/F, China United CentreCircular
Company announcement, 14-Jun-2005
It does so by buying the holding company of Great Gains International Ltd, which owns the properties. The vendor, Sunderland Properties, is said to be incorporated in the Cayman Islands, but we believe it is a BVI company of that name owned by Eugene Chuang Yue Chien.
Heritage buys Flat 22B, Royalton from China United for HK$22m
Company announcement, 21-Apr-2005
Heritage (0412) to invest in Found MacauCircular
Company announcement, 25-Jan-2005
China United (0273) to triple investment in Found MacauCircular
Company announcement, 12-Jan-2005
Karen Lo Ki Yan subscribes 9.99% of Heritage for $29.12m
Company announcement, 20-Dec-2004
Heritage buys floors 31-32, China United Centre, from Pacific Kingdom Investments Ltd for HK$51m
Company announcement, 30-Nov-2004
Note: the vendor was wholly-owned by China United Holdings Ltd (Bermuda) when that was sold by Willie to Eugene Chuang Yue Chien in 2003.
Heritage (0412) buys 4.99% of China Sci-Tech (0985) from Eugene Chuang Yue Chien for 13.29% new shares in HeritageCircular
Company announcement, 7-Sep-2004
Mr Chuang has borrowed $15m from Double Smart Finance Ltd, a 100% subsidiary of Heritage.
Hennabun Capital Ltd v Vincent Wong Chun Hung
HK Court of First Instance, 9-Jan-2002
Sale of 29.23% of B-Tech (Holdings) Ltd by vLink Global Ltd to Benny Kwong Kai Sing
Company announcement, 7-Nov-2001
Oriental Patron China Investment Ltd v Vincent Wong Chun Hung
HK Court of First Instance, 8-Oct-2001
Settlement of HK$15m to terminate Shanghai property sale
Company announcement, 15-May-2001
B-Tech (Holdings) Ltd: settlement of winding-up petition by Ampittia Inc.
Company announcement, 8-May-2001
B-Tech (Holdings) Ltd: settlement of winding-up petition by I-easy Assets Ltd
Company announcement, 26-Apr-2001
B-Tech (Holdings) Ltd: settlement of winding-up petition by Chung Nam Finance Ltd
Company announcement, 9-Apr-2001
B-Tech (Holdings) Ltd issues 33.3% of enlarged shares for 3.7% of vLink Global Ltd; winding-up petition by I-Easy Assets Ltd
Company announcement, 4-Apr-2001
Ampittia Inc. v B-Tech (Holdings) Ltd & others
HK Court of First Instance, 30-Mar-2001
Purchaser sues for completion of Shanghai property sale
Company announcement, 6-Mar-2001
B-Tech Holdings Ltd: disposal of shares in Cupac by mortgagee Ampittia Inc. for $5m, injunction against Shanghai property sale, termination of acquisition from China United, winding up petition by Chung Nam Finance Ltd.
Company announcement, 28-Feb-2001
Ampittia Inc. v B-Tech (Holdings) Ltd & others
HK Court of First Instance, 21-Feb-2001
Conditional sale of Shanghai property
Company announcement, 1-Feb-2001
Dong-Jun (Holdings) Ltd: conditional acquisition of units in China United Centre from China United Holdings Ltd
Company announcement, 4-Aug-2000
Dong-Jun (Holdings) Ltd invests HK$60m in Cupac Technology Ltd
Company announcement, 19-Apr-2000
Note: this was increased to HK$90m on 7-Jun-00
Breach of Listing Rule 14.23
Company announcement, 3-Apr-2000
Acquisition of Shanghai property
Company announcement, 26-Jan-2000
Breach of Listing Agreement
Company announcement, 31-Aug-1999

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