Thursday 27th January 2011

Dear Reader,

Following our article last week, there's still no disclosure from China Resources Enterprise (291) on what, if anything, its 50% profit-share is on its former stake in Hutchison's ports, which its parent China Resources Holdings flipped to HPH. Whatever the outcome, shareholders should be told.

Now, for today's story, we need you to get active and write a few words to HKEx...

Ex-chaos trading: Zhongtian proves point
Zhongtian (2379) yesterday demonstrated why we should not trade ex-entitlements before they are approved by shareholders: a 10:1 rights issue at a 97% discount was vetoed. HKEx launched a consultation in December, and we need your support. We also repeat two outstanding problems which HKEx has failed to address, on expropriation of passive shareholders' value, and on the discounts on open offers. (27-Jan-2011)

Karce chairman extracted hidden fee
According to a judgment published today, when Karce (1159) sold a PCB business in 2008, the price was actually US$4m, not US$3m as Karce announced, and US$1m went as a "consultancy fee" to a company called Extract Group Ltd. And guess who owned Extract? We tell you, and call on the SFC and SEHK to investigate. (21-Jan-2011)

HPH Trust is no loss to HK
Singapore has invested over US$5bn in Hutchison's ports, so it is not surprising that HPH is listing there. We look at the other incentives, and the governance concerns for the Business Trust structure. We also ask why China Resources Enterprise (291) has not disclosed the outcome of its profit-sharing after CRH flipped its port stakes to HPH. (21-Jan-2011)

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