Neo-China Plunges in Hong Kong After 45% Holding in Company Changes Hands
Neo-China Land Group (Holdings) Ltd., a Hong Kong-listed developer of Chinese real estate, plunged by a record on its first day of trading in more than two years after Shanghai Industrial Holdings Ltd. bought a controlling stake.
The stock dropped 43 percent, the most since listing in 1993, to HK$2.84, the lowest in almost four years, at close in Hong Kong trading, making it the market’s biggest decliner today. The benchmark Hang Seng Index fell 0.2 percent. Neo-China had been halted since Jan. 22, 2008.
Novel Good Ltd., a Shanghai Industrial unit, paid HK$2.32 a share on Jun. 24 for a 45 percent stake, and will offer to buy all outstanding stock, convertible bonds and warrants, Neo-China said in a filing yesterday.
The Shanghai Industrial purchase, of both new and existing shares, provided capital to Neo-China and prompted the stock exchange to allow the company to resume trading, Neo China said Jan. 19. During the suspension, Hong Kong’s Independent Commission Against Corruption searched the company’s premises and arrested a former employee.