Hong Kong Regulator Seeks to Bar Hanergy Founder, Four Directors From Company’s Board
The Hong Kong Securities and Futures Commission (SFC) asked a court on Monday to disqualify the founder and controlling shareholder of Hanergy Thin Film Power Group, as well as four current directors, from serving as company board members for as long as 15 years.
The regulator also required that the solar-equipment maker’s founder and former chairman, Li Hejun, make sure that parent company Hanergy Holding Group and its other affiliates repay debts due to Hong Kong-listed Hanergy Thin Film. Li must also execute a guarantee securing the repayments, the SFC said in a statement.
Hanergy Thin Film said in a filing with the Hong Kong Stock Exchange that Li and the four directors will not contest the sanctions demanded by the SFC as part of an agreement that will have the regulator consider allowing resumption in trading of the company's shares. Trading has been suspended for 20 months.
Hanergy Thin Film’s share price nearly tripled in less than a year before a massive selloff on May 20, 2015, triggered by investor concerns that the company failed to repay debts. Trading has been suspended since while the SFC investigated.
The SFC said it disqualified the five because they “failed to question the viability of Hanergy Thin Film’s business model, which relied on the sales of solar panel production systems to its connected parties — Hanergy Holding and its affiliates — as its main source of revenue, and failed to properly assess the companies’ financial position.” The directors have “put the interests of the connected parties before those of Hanergy Thin Film, and so did not act in the company’s best interests,” SFC said.
Contact reporter Han Wei (firstname.lastname@example.org)
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