It took a while, but everyone’s favorite party animal, Peter Mak aka Mak Kin Kwong (or around these parts, “King Kong” for short), is caught up in yet another stock scandal.
Long time readers remember King Kong from back in August 2011, when we examined his role as CFO of now disgraced and delisted Chinese reverse merger, and Chardan Capital client, A-Power Energy Generation (APWR) and listed the many companies where he served as a director. Catch up on it here.
The Hong Kong Stock Exchange today suspended trading in one of those companies, Huabao (336 HK, HUIHY in the US) on the heels of a blistering report by Anonymous Analytics. The report, available here, exposes the company as yet another Chinese reverse merger piece of trash, using all the typical tricks (and then some) to move money from investors into the hands of insiders. Of course, this was no ordinary piece of junk, it did a reverse-merger not onto the OTCBB, but stayed closer to home, and, with a $1.6bn US market cap, Huabao is one of the larger Chinese scams. Read the AA report for all the juicy details.
Now is the time where we poke fun at the supposedly “smart money” institutional investors who either held their positions or were stupid enough to add to them, once evidence of fraud and bad actors comes to light. And we will. But today we must also congratulate one firm for doing something right, Morgan Stanley. According to a filing dated April 18, 2012 Morgan Stanley had a net short position in Huabao of almost 1%. Good work, and at BuyersStrike! we don’t often say that about the big banks. Of course, there are still a bunch of retards at Morgan Stanley Private Equity Asia (Homer Sun?) who foolishly buy into some of these names.
As for the hall of shame entrants, give a big hand to the morons at Lazard who hold almost 15% of Huabao. And double congratulations to the fools at Wellington who own 7% of Huabao and own 11.5% of still halted, disgraced, Sino-Forest (TRE CN) aka Tree-X.
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