Aluminium firm Zhongwang seeks legal advice after US charges

In this May 8, 2009 file photo, Liu Zhongtian, the Chinese billionaire chairman of the China Zhongwang Holdings Limited, celebrates at the company's listing ceremony in the Hong Kong Stock Exchange. (AP)
Updated 05 August 2019

Aluminium firm Zhongwang seeks legal advice after US charges

  • In its statement, Zhongwang said its board believed the legal proceedings had so far had no material adverse impact on the company’s operations or its financial condition

BEIJING: China Zhongwang Holdings said on Sunday it was seeking legal advice after the company and its controlling shareholder, Liu Zhongtian, were indicted on charges they evaded $1.8 billion of tariffs by smuggling aluminum into the US.
Zhongwang said in a statement to the Hong Kong Stock Exchange that it and Liu had still not been served with any notice in relation to the legal proceedings.
“The company takes seriously any allegations that it may have violated any law, and is seeking legal advice in relation to the alleged proceeding,” it said in the statement, adding it would keep shareholders informed of further developments.
Zhongwang is based in northeast China’s Liaoning province and makes aluminum products for the automotive and construction industries.
US prosecutors have alleged that companies affiliated with Liu used ports in the Los Angeles area to import aluminum from China that was disguised as a finished product not subject to duties, before making bogus sales.

FASTFACT

• Zhongwang says operations, finances not impacted.

• Firm could face monetary penalties.

• Company and founder Liu Zhongtian indicted in US.

• Zhongwang makes aluminum products for the automotive and construction industries.

Zhongwang has previously described smuggling allegations as “misleading” and “without any factual basis.”
Liu stepped down as Zhongwang chairman in 2017 but remains its largest shareholder with a 74.16 percent stake, according to Refinitiv Eikon data.
“If the allegations were proven in court, the company could face monetary penalties,” Zhongwang said in the statement.
Zhongwang’s share price fell by 14.2 percent on Thursday, after the indictment was reported, and fell a further 7.6 percent on Friday to end the week on HK$3.18 ($0.4062), its lowest close since October 2015.
In its statement, Zhongwang said its board believed the legal proceedings had so far had no material adverse impact on the company’s operations or its financial condition.
“The company continues to operate as normal,” it said, adding that a further announcement would be published if the situation changes.


Saudi Aramco sets IPO share price between 30-32 riyals

Updated 17 November 2019

Saudi Aramco sets IPO share price between 30-32 riyals

  • Saudi Aramco intends to buy $1 billion worth of shares for employee

DUBAI: Saudi Aramco’s multibillion-dollar initial public offering (IPO), probably the biggest in history, shifted to full gear as its share price was announced and subscription to the world’s biggest oil company commenced on Sunday.

Saudi Aramco set an indicative share price between 30 and 32 riyals for the 1.5 percent of its oustanding shares – or about 3 billion shares of its 20 billion regular shares – that it would offer for the domestic part of its public offering. The blockbuster IPO could be worth least $24 billion, and values the state-owned oil giant at up to $1.71 trillion.

The offering – or book-building – period for institutional subscribers, which started today, closes on December 4 while the retail offering for individual investors will begin on November 21 and will end on November 28. Individual investors will subscribe based on a price of 32 riyals, the top end of the price range, the company noted in a document.

The final pricing for the Aramco shares would be announced on December 5, and Saudi Tadawul  – the Kingdom’s stock exchange – would make an announcement when initial trading day would be, the company added.

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For more of our coverage of the Aramco IPO, click here.

To view key Aramco IPO documents, click here.

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Samba Capital & Investment Management Company has been designated as issue manager while National Commercial Bank, Saudi British Bank, Samba Financial Group, Saudi Investment Bank, Alawwal Bank, Arab National Bank, Albilad Bank, Aljazira Bank, Riyad Bank, Al Rajhi Bank, Alinma Bank, Banque Saudi Fransi and Gulf International Bank were named as receiving banks.

If there are applications for more than the 0.5 percent on offer — amounting to 1 billion shares — allocations to private investors will be scaled back proportionate to demand; if there are fewer applications than the 0.5 percent when all maximum applications are satisfied, private investors can have the over-payment refunded either in cash via the receiving banks or in the form of extra shares in Aramco.

There is an incentive mechanism in the IPO whereby Saudi investors will receive a bonus one-for-ten allocation of shares, up to a maximum of 100 shares, if they do not sell shares in the market for a period of six months after dealings begin in December, at a date still to be determined.

Saudi Aramco also intends to buy $1 billion worth of shares for employees under a plan to incentivize executives and staff members alongside the IPO next month.

The plan — which was disclosed in the IPO prospectus — will involve Aramco buying the shares from the government and making them available for employees under special terms.