HONG KONG, May 28, 2012 /PRNewswire-Asia/ -- QVT Fund LP and Quintessence Fund L.P. (together "QVT") note the announcement made by China Assets (Holdings) Limited (the "Company") on 4 May 2012 (the "4 May Announcement") addressing QVT's request that the Company comply with its obligations under the Companies Ordinance in relation to QVT's requisition of an Extraordinary General Meeting ("EGM") and QVT's request to the Company to conduct an investigation into interests in the Company pursuant to section 329 of the Securities and Futures Ordinance. As set forth below, QVT questions the reasons stated by the Company for not giving shareholders an opportunity to vote on whether to re-appoint the Company's current manager and thereby cure the Company's breach of the Listing Rules. QVT hereby reiterates its expectation that the Company convenes the EGM requisitioned by QVT and ensures full compliance with its obligations under the Securities and Futures Ordinance.
QVT believes that the Company has not given satisfactory reasons for not convening its own EGM
In the announcement made by the Company on 12 December 2011, the Company stated that the delay in convening its own EGM in relation to the Investment Management Agreement (the "IMA") was "in light of the many public holidays in the first quarter of 2012." QVT notes, however, that there were only 4 public holidays in the first quarter of 2012 which fell on normal working days, excluding Saturdays. Similarly, in the announcement of 27 March 2012, the Company again makes reference to "the forthcoming public holidays" in relation to the delay of the dispatch of the circular. QVT again notes that there were only 3 public holidays in April 2012 which fell on normal working days, excluding Saturdays.
QVT notes that the Company states in the 4 May Announcement that the delay is due to the fact that the circular has not yet been cleared by the Stock Exchange "for reasons beyond the Company's control." However, no further information is provided as to why the Stock Exchange has not cleared the circular.
QVT therefore calls upon the Company to explain to shareholders in further detail the reasons for the delay.
QVT believes that the Company has not given satisfactory reasons for failing to comply with QVT's requisition
The Company states in the 4 May Announcement that "if the Company were to convene an EGM now as requested by QVT, Shareholders would not be provided with all material information about the Amended Investment Management Agreement" and if QVT convenes an EGM itself "this would be regrettable since it would force shareholders to make a voting decision in the absence of material information and of advice from an independent financial advisor."
QVT disagrees with these statements. If an EGM were to be convened immediately, QVT believes that sufficient time would be available for the Company to prepare and release a circular in order to provide its shareholders with sufficient information. Even if the Company fails to release a circular prior to the EGM, it does not relieve the Company of its obligation under the Companies Ordinance to convene an EGM in response to QVT's requisition. QVT considers that, particularly because of the ongoing breach of the Listing Rules by the Company, the Company should comply with the requisition notice, and should provide shareholders with a full explanation of where matters currently lie.
QVT is concerned to ensure that all shareholders with a material interest in the IMA abstain from voting
In the 4 May Announcement, the Company refers to the fact that, in QVT's view, "any shareholder with a material interest in the Amended Investment Management Agreement and its associates should abstain from voting at the EGM in respect of resolutions considering the Amended Investment Management Agreement."
The Company further states that "QVT itself has not identified any parties with material interests in the Amended Investment Management Agreement not already known to the Company."
QVT notes that the ownership of China Assets Investment Management Limited ("CAIML") is vested in two companies incorporated in the British Virgin Islands whose ultimate beneficial owners are not identifiable from publicly available records. QVT is therefore interested to understand if any shareholders of the Company have connections with the shareholders and/or ultimate beneficial owners of CAIML, and therefore requested the Company to initiate an investigation into the interests in the Company pursuant to section 329 of the Securities and Futures Ordinance and publicly disclose such interests.
QVT notes that over eight months have passed since the Company announced that it has been in breach of the Listing Rules, and over two months have passed since QVT requisitioned an EGM to cure the Company's breach of the Listing Rules. QVT therefore calls upon the Company to comply immediately with its obligations and convene the EGM requisitioned by QVT and fully investigate the interests of the Company's shareholders.
Enquiries:
The Abernathy MacGregor Group
Shawn Pattison
Patrick Clifford
Mark LaVoie
Telephone: +1 212-371-5999
Fax: +1 212-752-0723
