SFC sanctions Koo Ming Kown

19 May 2009



The Securities and Futures Commission (SFC) has taken disciplinary action against Mr Koo Ming Kown in relation to breaches of the Code on Takeovers and Mergers (Takeovers Code).

The Takeovers Executive (Executive) has imposed an order denying Koo direct or indirect access to the Hong Kong securities markets (a “Cold Shoulder Order”) for 24 months from 25 May 2009 to 24 May 2011.

The Executive also publicly censures Koo in relation to his conduct in this matter.

Koo is the only non-executive director of Nam Tai Electronic & Electrical Products Ltd (NTEEP) and the only executive director of Nam Tai Electronics, Inc (NTEI).

On 14 April 2009 the Takeovers and Mergers Panel (Panel) ruled that the voluntary conditional general cash offer by NTEI to privatise NTEEP that had lapsed on 6 April 2009 could not be re-opened.

Since the publication of the Panel’s decision on 21 April 2009, the Executive has reminded Koo both directly and through his advisers on a number of occasions of the importance of observing the disciplines of the Takeovers Code.

On 11 May 2009 NTEEP announced its latest quarterly results which disclosed a substantial deterioration in the financial performance in NTEEP and its subsidiaries for the three months ended 31 March 2009.

On 12 May 2009 NTEEP issued an announcement regarding a voluntary winding-up of the company. Koo was aware that the proposed voluntary winding-up would be regarded as a further privatisation attempt under the Takeovers Code and was subject to a 12-month restriction under the Takeovers Code which prohibited NTEI from making another offer for the shares in NTEEP unless the Executive consented otherwise.

The Executive raised its grave concerns with Koo and following further discussions, an application was submitted for consent under the Takeovers Code for NTEI to make a further general offer for all the shares in NTEEP (other than those shares already owned by NTEI) within 12 months of the lapse of a previous offer by NTEI. On 19 May 2009 the Executive granted the consent having regard to the specific facts and circumstances of the case. Further details are set out in the Executive Statement dated 19 May 2009.

The 12 May 2009 announcement was published by Koo in full knowledge that it constituted a number of serious breaches of the Takeovers Code. Koo failed to co-operate with the Executive, which was in breach of General Principle 10 of the Takeovers Code.

The primary purpose of the Takeovers Code is to afford fair treatment of shareholders. The Executive believes that the conduct of Koo constituted intentional and serious breaches of the Takeovers Code which merit strong disciplinary action.

Koo accepts that he has breached the Takeovers Code and has consented to the disciplinary action taken against him under section 12.3 of the Takeovers Code. Koo has apologised unreservedly for his conduct in this matter and has undertaken to fully co-operate with the SFC and comply with the regulatory requirements on all matters relating to the Takeovers Code.

A copy of the Executive Statement and the relevant Takeovers Code provisions and Order can be found in the Takeovers and Mergers Executive Statements section of the SFC website at www.sfc.hk.


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Page last updated : 1 Aug 2012