Share-sale cloud swamps CyberWorks
HUI YUK-MIN, BEN KWOK and DAVID WILDER
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Pacific Century CyberWorks' shares plunged to a new low yesterday amid intensified worries of pending placements by major shareholders.
The counter finished at HK$4.20, down 7.69 per cent.
But investor concern pushed the share price to as low as HK$4.15, the lowest since CyberWorks completed its backdoor listing in August 1999 by taking over Tricom Holdings, a telecommunications service provider.
Brokers said CyberWorks was hit by negative rumours from two fronts.
According to one rumour, Hikari Tsushin president Yasumitsu Shigeta was placing the company's 1.56 per cent stake in CyberWorks shares. Another had it that Britain-based Cable & Wireless (C&W) was willing to place its 7.6 per cent stake in the company as low as HK$3.
"Rumours were that Hikari Tsushin is placing CyberWorks shares," said Francis Wong, a director at Celestial Securities. "Fund managers are looking to increase their exposure in TMT [technology, media and telecoms] stocks, though not through CyberWorks."
The fall in CyberWorks shares offset rebounds in technology and telecoms stocks, leaving the Hang Seng Index flat at 15,293.76, down 1.66 points.
Hikari Tsushin is Japan's No 2 Internet investment company and an official denied the rumours, saying that Mr Shigeta had no intention of disposing of the CyberWorks shares.
Mr Shigeta's company, which holds 342.5 million CyberWorks shares following a US$1 billion share-swap with Richard Li Tzar-kai in February, has faced paper losses of HK$6.4 billion in his CyberWorks shares, representing an 82 per cent drop in valuation.
Brokers said fears had intensified that C&W might place out a 7.6 per cent stake in CyberWorks after the share lock-up period expires on February 17.
They said hedge funds had heavily sold down CyberWorks shares on rumours that C&W was planning to sell CyberWorks shares at HK$3 next month. "It definitely hurt sentiment but they can only sell after February 17 so it would be premature to suggest that they'd sell it at HK$3," said Sunny Chan at KGI Securities.
"If I was C&W, I wouldn't sell at the moment because at HK$3, they'd only get HK$4.5 billion so I don't think it's worthwhile to sell at the moment unless they're really pessimistic about the future."
SG Securities analyst Jonathan Iu said: "The counter seemed to be searching [at the] bottom despite no genuine selling."
Meanwhile, CyberWorks shareholders will vote today on whether to accept the strategic alliance with Australia's Telstra Corp.
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