Friday 19th October 2018
What better way to celebrate the 31st anniversary of Black Monday?
The Huarong-CMB network: 26 stocks not to own
In our first circuit diagram since the infamous Enigma Network, we examine the overlapping networks, bubbles and funding surrounding 26 HK-listed companies that your portfolio would probably do better without. (19-Oct-2018)
Huarong and China Singyes Solar Technologies (0750)
CSST, now suspended pending disclosure of its financial position, has failed to disclose in its reports the interest of Huarong Int Fin (0993), which claims to have a 15.09% interest, including 8.04% purchased from an unknown vendor in Dec-2017 and security over a further 7.05% pledged to it, presumably to secure a put option that it claims to have been granted. By whom? (18-Oct-2018)
RECENTLY ON WEBB-SITE
The Princeton economist and a plot in Sheung Wan
A tiny plot of prime HK land left behind in a company dissolved in 1972 is now a potential windfall in a redevelopment of its surroundings. For 54 years, Professor Gregory Chow never knew he had a stake in it. (8-Oct-2018)
First Capital (1269) and a questionable joint venture
Webb-site finds serious problems with CFC's statements about a GBP60m UK start-up joint venture with a BVI company, the owner of which is not disclosed, which has only partly paid for its share of the JV. (7-Oct-2018)
and the Chung Nam Network
Webb-site can reveal another SFC investigation underway involving dealings in Pak Wing (8316). The manipulation of this GEM bubble reveals another connection between China Huarong (2799) and what we call the "Chung Nam Network". The more we scrutinise Huarong, the worse it looks. Will the State end up bailing out the bailer? (3-Oct-2018)
IN OTHER NEWS
Freeman (0279) renegotiates US$99m convertible held by 51% subsidiary of China Huarong (2799)
Company announcement, 18-Oct-2018
This comes 20 days after they renegotiated the other HK$429m CB held by Huarong Inv (2277) which is also a subsidairy of China Huarong. The conversion price of both is reduced from $0.425 to $0.065.
SFC launches report-a-crook form
Don't hold back! Good to see that new logo, too. Celebrating the 20th anniversary of Peregrine's collapse.
Censure of NNK (3773) and various directors
Lai Xiaomin, ex-Chairman of Huarong (2799) expelled from Party (in Chinese only)
CCP Central Commission for Discipline Inspection, 15-Oct-2018
Next comes the formality of prosecution.
Small house, big issue | Fixing
the Small House Policy
South China Morning Post, 14-Oct-2018
David Dodwell mentions the proposals we published in Sep-2014 in "Fixing the Small House Policy". We propose a reverse tender to extinguish a quota of claims of village men descended on the male line from 1898 (and their unborn male descendants or sons under 18 years old). We now call this the Buyout of Indigenous Rights To Houses (BIRTH) scheme. At the same time, the policy should be amended so that all new land leases for village houses can only be transferred to other indigenous men, and cannot be upgraded and flipped into the open market.
Concentration warning in Zhaobangji Props (1660)
The top 20 holders have 90.78%.
"Backchat" re Policy Address
LegCo candidate Leticia Lee See Yin charged with engaging in corrupt conduct
Settlers Housing Corp financial statements, 31-Mar-2017
Company filing, 10-Oct-2018
The company is limited by guarantee with 7 members. All the 7 directors are associated either with Henderson Land (0012) or Bank of East Asia (0023), which is also its banker and manager of HK$484m of securities. The audit report is qualified because the firm fails to revalue its investment properties, which are held at $1. It owns the Tai Hang Sai Estate in Shek Kip Mei, and in today's policy address, that is up for redevelopment. The land was granted in 1961 at a concessionary premium and the 1600+ flats are leased at below-market rates.
Peak Tramways Co Ltd gets Peak Tram operating rights until 31-Dec-2035
HK Government, 10-Oct-2018
The firm is owned by HK & Shanghai Hotels (0045). There does not appear to have been any tender for the contract. This extension is granted less than 3 years after the last 10-year extension was granted on 2-Dec-2015, just 29 days before expiry. The company will now build a "temperature-controlled queuing and waiting area" for 1300 passengers at the lower terminus, and increase the capacity from 120 to 210 passengers per trip.
And much more besides...
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