Hanergy suspended trading on the Hong Kong exchange last Wednesday after stocks crashed by 47%, wiping $20bn off its market value.
AFP/Hong Kong
Hong Kong’s market watchdog said yesterday it is investigating Beijing-based solar energy firm Hanergy Thin Film Power Group (HTF) which suspended trading last week after its share price plunged.
HTF had surged more than six-fold in the past year, making it the world’s largest solar power company by market value, but prompting questions over its valuation and revenue sources.
It suspended trading on the Hong Kong exchange last Wednesday after stocks crashed by 47%, wiping $20bn off its market value.
The Securities and Futures Commission (SFC) had previously refused to comment on whether an investigation into Hanergy was under way.
“The SFC wishes to clarify that a formal investigation into the affairs of Hanergy Thin Power Group... has been active and is continuing,” it said in a statement yesterday.
The commission said it was making the statement “given the public interest following reports denying such measures have been taken”.
Hanergy founder and chairman, Chinese tycoon Li Hejun, had told China’s state-run news agency Xinhua earlier yesterday that the company was not under investigation from regulators. The SFC gave no details on the investigation and said it would not comment further.
Hanergy said it would make an announcement in the wake of its stocks suspension, but has not done so. A report by the London-based Financial Times in January said the Hanergy Group made its fortune largely through unconventional sales between HTF, its listed subsidiary, and itself.
Li was named as China’s richest man in February in a wealth survey, replacing e-commerce giant Alibaba’s founder Jack Ma.
He saw his wealth nearly triple compared to a year before, according to the Hurun Report’s Global Rich List 2015 which valued his fortune at $26bn.
Prior to its plunge, Hanergy Thin Film’s market value had at one point topped HK$300bn, Bloomberg said, but the fall in the share price would shave off HK$144.3bn.
The day after Hanergy collapsed, two of Hong Kong’s best-performing stocks – Goldin Financial and Goldin Properties – plunged more than 40%, with analysts saying city regulators’ oversight had been called into question. Both Goldin stocks have since bounced back and closed yesterday up 1.56% at HK$19.56 ($2.52) and 14.47% at HK$26.1 respectively. The two Goldin firms’ interests range from property development in Hong Kong and China to vineyards in California and France.
