Hong Kong’s Securities and Futures Commission sanctioned Tianhe Chemicals Group Ltd. and its executive director this week, finding them culpable for greatly overstating the company’s revenue and profits in the lead-up to its 2014 initial public stock offering.
In a decision announced Tuesday, the commission said its Market Misconduct Tribunal suspended Executive Director Wei Xuan for four years from serving as a director or participating in the management of any company listed on the Hong Kong exchange. It also ordered Wei and Tianhe to reimburse the commission for its costs in the case, though it did not disclose the total of those costs.
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Tianhe conducted its IPO on June 9, 2014, raising net proceeds of approximately 3.5 billion Hong Kong dollars (U.S. $454 million) in what turned out to be the fourth-largest initial offering on the Hong Kong exchange that year. The company, which is based in Jinzhou, China, claimed at the time to be the largest lubricant additive supplier in Asia and said it aimed it grow big enough to compete with the industry’s four main suppliers of additive packages, Lubrizol, Infineum, Chevron Oronite and Afton Chemical.