Hong Kong regulator orders Sound Global share trading halt

China High Precision Automation

14/04/2016 07:01

By Donny Kwok 
    HONG KONG, April 14 (Reuters) - Hong Kong's securities 
watchdog on Wednesday ordered a halt in trading of shares in 
Beijing-based waste water treatment firm Sound Global Ltd 
 0967.HK , less than three months after the stock resumed 
trading after a prolonged suspension last year pending a review 
of its finances. 
    "Trading in shares of Sound Global Ltd. was suspended at the 
direction of the SFC (Securities and Futures Commission)," a 
spokesman for the watchdog said in an email to Reuters.  
    The spokesman didn't say why the SFC had requested the halt, 
described by Hong Kong analysts as a rare move by the SFC. 
    Sound Global confirmed its share trading halt in a statement 
on Wednesday but gave no further details. 
    Shares in the company, which has a market value of $579 
million, fell 3.2 percent on Tuesday prior to the suspension.  
    The stock was suspended between Mar. 13 last year and Jan. 
25 while the company conducted a forensic accounting review on a 
cash discrepancy after research firm Emerson Analytics said in a 
report Sound Global had overstated revenue. Shares plunged 62 
percent on the trading resumption.  urn:newsml:reuters.com:*:nIFPdwB2Z  urn:newsml:reuters.com:*:nWNBS01T9Z 
    Sound Global's former auditor, Deloitte Touche Tohmatsu, 
identified a shortfall of 2 billion yuan ($309 million) between 
the firm's bank cash balance and its books as of Dec. 31, 2014. 
The company said last year this was due to the omission of 
certain payment records for proposed acquisitions of two Chinese 
water treatment firms. 
    The company said it had put in place adequate financial 
reporting procedures and internal control systems to meet its 
obligations under the listing rules, and to publish all 
outstanding financial results as required.   
    Under the same listing rules, the SFC also directed a 
trading halt in shares of Hanergy Thin Film Power  0566.HK  in 
May last year, Superb Summit International  1228.HK  in November 
2014, and China High Precision Automation  0591.HK  in August 
2014. The stocks are still suspended from trade. 
     
($1 = 6.4824 Chinese yuan renminbi) 
($1 = 7.7567 Hong Kong dollars) 
 
 (Reporting by Donny Kwok; Editing by James Pomfret and Kennneth 
Maxwell) 
 ((donny.kwok@thomsonreuters.com; +852 2843 6470; Reuters 
Messaging: donny.kwok.reuters.com@reuters.net)) 
 
Keywords: SOUNDGLOBAL SUSPENSION/