Quick Take – Harbin deal not yet done? (HRBN)

Some very interesting news out this morning about Harbin Electric (HRBN), one of the strangest of the Chinese reverse-merger companies that litter the US markets. According to Bloomberg the DTC has not been provided with the $24.00 per share in cash promised to shareholders in the going-private deal:

OCC to Delay Settlement of Harbin Electric Exercise Activity
2011-11-03 12:02:43.346 GMT

By Joshua Fineman and Clyde Eltzroth
Nov. 3 (Bloomberg) — OCC was informed by DTC that paying agent hasn’t funded DTC for deal of $24/shr: OCC web site.
* OCC to delay settlement of HRBN exercise/assignment activity until confirmation that cash consideration has been paid
* NOTE: HRBN going private deal closed on Tuesday (Nov. 1)
Link to OCC site: http://bit.ly/vWD3Cr

Could just be a timing issue, but given the sleaze surrounding Harbin, perhaps someone at China Development Bank figured out the con?

The content contained in this blog represents only the opinions of the author. The author may hold either long or short positions in securities of various companies discussed in the blog. This commentary in no way constitutes investment advice, and should never be relied on in making an investment decision, ever. This blog is not a solicitation of business: all inquiries will be ignored. The content herein is intended solely for the entertainment of the reader, and the author.
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3 comments

  1. Nope! Either they didn’t figure it out or they didn’t care, because the most recent OCC memo says that this thing is a done deal.

    Oh, it was definitely a scam. That much is certain. But us shorts didn’t count on a state-owned bank deciding to foot the bill, and at a very reasonable 4 1/2 over LIBOR no less!

    1. @ Jimmy James – Very true. Reminds me of China Water and Drinks (CWDK) another of the mid 00s group of bogus China reverse mergers. The CWDK buyout did go through, much to the buyers regret. I would not be surprised if the regulators and the exchange officials were happy to look the other way and let this deal happen, to let Harbin (and CFSG today) get swept under the rug.

      1. I think you’re right about the regulators turning a blind eye. Bigger picture: the shorting Sinofrauds trade is now pretty much dead.

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