NEWS & UPDATES
RTC assisted YesAsia Holdings Limited’s over HK$129 million IPO
Ronald Tong & Co assisted YesAsia Holdings Limited (“YesAsia”) in its global offering of 39,540,000 shares and listing on the Main Board of The Stock Exchange of Hong Kong Limited (Stock code: 2209).
YesAsia is a Hong Kong-headquartered E-commerce platform operator engaging in the procurement and sale of Asian fashion and lifestyle, beauty and entertainment products to customers around the world.
Our team provided advice and other assistance to YesAsia on the reorganisation and ancillary matters in relation to its listing from Hong Kong law and listing rules compliance perspectives. Our team also acted for YesAsia in rendering reports on tenancies and licenses entered into by the YesAsia and its subsidiaries.
RTC advised on acquisition of bakery chain
Ronald Tong & Co advised a Hong Kong private company on its acquisition of a well-known local bakery chain with a history of more than 30 years and over 25 outlets in Hong Kong.
Our team provided guidance and advice on legal due diligence, deal structure, pricing and completion mechanism throughout the acquisition process to tailor the deal to client’s business objective and risk profile.
RTC acted for Yip’s Chemical (00408.HK) on HK$282 million disposal of property holding company
Ronald Tong & Co acted for Yip’s Chemical Holdings Limited (00408.HK)("Yip’s Chemical") on the sale of an industrial building in Fanling, Hong Kong held by its group to a third party investment fund via disposal of the entire issued share capital of a property holding subsidiary together with shareholder's loan at a total consideration of HK$282 million. Simultaneous exchange and completion took place in July 2021.
Yip’s Chemical group manufactures and trades petrochemical products including solvents, coating, inks and lubricants, it boasts a distribution network that covers all major provinces and cities in the People’s Republic of China. Shares of Yip’s Chemical are listed on the Main Board of The Stock Exchange of Hong Kong Limited (stock code: 408).
Unfreezing of about HK$150 million in the Securities Accounts Frozen by SFC
About HK$150 million in the securities accounts of our clients were frozen by a Restriction Notice of the Securities and Futures Commission (“SFC”) for suspected insider dealing.
We made an application by way of submissions to have the Restriction Notice withdrawn.
The basis of our application was the unreasonably wide scope of the Restriction Notice and undue delay on the part of the SFC to deal with the investigation.
The Restriction Notice was withdrawn, and the securities accounts were unfrozen.
Application of Mainland Judgments (Reciprocal Enforcement) Ordinance to Bankruptcy Proceedings
Whilst Bank of China (“BOC”) was suing the debtor in Mainland China, BOC served a statutory demand on the debtor in Hong Kong for about RMB600 million which was a debt arising from a guarantee.
The debtor applied to set aside the statutory demand, and the application was dismissed by the Court of First Instance.
The debtor appealed to the Court of Appeal.
The major ground raised by the debtor was that BOC was not entitled to bring any proceedings against him in Hong Kong under the guarantee; it was further argued that BOC should have enforced the judgment by the court in Mainland China under the Mainland Judgments (Reciprocal Enforcement) Ordinance (Cap. 597) (“MJREO”).
The Court of Appeal dismissed the debtor’s appeal and held that, inter alia, MJREO is irrelevant in this case given that at the time the statutory demand was presented, the relevant Mainland judgment was not capable of being registered in Hong Kong.
The Court of Appeal also ruled that the service of a statutory demand is not a legal process and bankruptcy proceedings are not “proceedings for the recovery of a sum payable” under section 22 of the MJREO, having regard the class right nature of bankruptcy proceedings.
The ruling of the Court of Appeal is a landmark decision in that it is the first decision in Hong Kong which clarifies the applicability of section 22 of the MJREO to bankruptcy proceedings. The decision should be welcomed by practitioners involved in cross-border enforcement actions.
A copy of the judgment by the Court of Appeal can be retrieved from the link here. *
*Note: The judgment is subject to appeal to the Court of Final Appeal.
RTC acted for a former director of Shanshui Cement to defend claims of conspiracy and breach of directors’ duties
We acted for a former independent non-executive director of China Shanshui Cement Group Limited (“CSC”; a company listed in HKEX (Stock Code: 00691)) in defending a claim for breach of fiduciary duties and unlawful means conspiracy, seeking for damages in the amount of at least HK$277 million.
The action was brought against eight ex-directors and two substantial shareholders of CSC. 8 legal teams, involving a total of 17 barristers, including Senior Counsel took part in the 35 days’ trial. As majority of the witnesses were residing outside Hong Kong, due to travel restrictions arising from COVID-19, cross examination of most factual and expert witnesses took place via videoconferencing facilities with the assistance of electronic trial bundles of more than 100,000 pages, which is equivalent to 400 physical paper bundles. The case is now pending the Court’s judgment.
The case involved two camps of shareholders fighting over control of CSC where the incoming board lodged claims against the outgoing board only 3 days after the takeover. One of the issues raised by the defendants was whether adequate due diligence and/or investigation had been conducted before commencement of legal action. An incoming director, who was also a receiver of the shares of one of the major shareholders of CSC at the material time, was challenged for being overzealous in commencing proceedings. In the course of the trial, counsel for the defendants also raised the question of whether a director, being a non-party, who commence the proceedings prematurely should bear the costs of the action.
Grand Opening of Ronald Tong & Co
We are happy to announce the official opening of Ronald Tong & Co on 2 August 2021.
Leading by Mr. Ronald Tong, founder of Ronald Tong & Co and Cheung Tong & Rosa Solicitors (a Hong Kong based law firm with over 40 years of history), Ronald Tong & Co will provide high quality corporate commercial, intellectual property, litigation, real property and private clients and related services to international, local and mainland China clients.
May we also take this opportunity to thank our clients for their trust and continuous support of our team.