Tianhe Chemicals Group said Thursday that Hong Kongs securities regulator ordered a halt in the trading of the Chinese lube additive suppliers shares on grounds that the companys June 2014 prospectus was misrepresentative. Its trading had been suspended for other reasons since early 2015.
The Securities and Futures Commission directed the Hong Kong Stock Exchange to suspend all dealings in the shares of Tianhe effective May 25, Tianhe announced in a statement to the exchange Thursday.
Tianhe said the agency invoked its power under Rule 8 of Hong Kong listing regulations "because it appears to the commission that Tianhes prospectus dated June 9, 2014, and [subsequent] clarification announcements contained materially false, incomplete or misleading information." The move was intended to protect investors and maintain a fair market, it added.
The company is seeking further legal advice as to its rights, as well as how to address and resolve the commissions concerns going forward and resume trading of the shares, Tianhes Chairman and Executive Director Wei Qi said in the statement. Lube Report Asia could not reach Tianhe officials for further details by deadline.
Tianhe had not traded on the exchange since March 2015, when it requested its trading be suspended in anticipation that it would not meet the deadline to submit its 2014 annual results. It had also been suspended for a month in September 2014 after being accused of fraud by watchdog organization Anonymous Analytics.
The firm underwent several third-party audits and reviews to try to shore up accounting issues preventing it from submitting its 2014 results. In late January, Tianhe submitted a draft of its 2014 results under the guidance of its independent auditor, Hong Kong-basedZhonghui Anda CPA. The exchange has not indicated whether the submission was satisfactory.
The Jinzhou City, China-based Tianhe, which also supplies fluorochemicals, has claimed to be the largest Asian lube additives supplier.