You really are sharp keith...
What initially caught my eye, being a securities lawyer, were the following excerpts:
undertake two levels of equity financing raising $50-million (U.S.) for SEG. Capital Alliance will distribute 22 per cent of its ownership in SEG for $10-million (U.S.) at the first level as pre-IPO financing, and $40-million (U.S.) at the second level as IPO placement.
The sponsorship agreement appoints ICEA Capital Limited and Tai Fook Capital Limited, both from Hong Kong, as SEG's sponsors for its Hong Kong IPO. ICEA has been appointed as the global coordinator, sponsor and lead manager, and Tai Fook will serve as the joint-lead sponsor and joint-lead manager.
ICEA is established through a joint venture between Industrial Commercial Bank of China (ICBC) and Bank of East Asia. ICBC has 36,000 branches and was ranked the
third largest bank in the world with assets of $498-billion (U.S.)in 1998
Now as you so well put it, unlike many of the underwriting agreements in North America which are best effort financings, when a brokerage firm in Asia executes an agreement to underwrite a company they undertake to raise the entire amount of the issue.
That amounts to approx 75 million Cdn for a company with only about 6 million or so shares issued and outstanding, without even taking into account the real value of their majority interest in SEG.
Another thing that should be pointed out IMO...
Sid Klein, an asian fund manager from HSBC who I had lunch with a few weeks ago, mentioned that the Asian markets were poised for huge growth in the following years, said markets already being down about 90% since 1988. This will most assuredly benefit CPT and SEG.
Kind Regards
AK |
