Thursday 15th March 2012

Dear Reader,

So far 427 of you have cast your votes for CE in our poll. 31.9% would cast a blank vote, 11.5% would vote for Henry Tang, 12.4% for Albert Ho and 44.3% for C Y Leung. Meanwhile we've had 1217 participants (that's more than an Election Committee) in the odds questions with C Y Leung's chances of being CE standing at only 44.0% and Henry Tang's at 33.9%. Whom would you vote for, if you were allowed to vote? Please update your estimates and cast your vote. Your PIN is above.

Now for our Caesar salad...

NEW ARTICLES
HKEx preps for placing
Apart from seeking a steep pay hike, the HKEx board is seeking to double its mandate to issue shares for cash without a rights issue, at double the discount of last year's mandate. Couple that with the leaked bid for the London Metal Exchange, and you can see where this is going. We urge shareholders to protect their rights by voting down the general mandate. If HKEx proceeds with LME (and we query why), then a rights issue can fund it. (15-Mar-2012)

RECENT ARTICLES
Decapitate the headcount
We make the case for abolition of the archaic and anarchic headcount rule in Schemes of Arrangement, which was brought into focus when we reported evidence of a vote-rigging scheme in the proposed PCCW privatisation in 2009. For once, the tycoons agree with us, but the Government seems afraid to take the lead. (12-Mar-2012)

Raking muck, Part 5
In the penultimate episode, we look at a transaction in progress by Railsmedia (0745) and how it connects with CPEC (8041), COMG (0254) and 3 shells. We also introduce a 10th listed company to the story, Zhi Cheng (8130) which has such a track record of value destruction that it has consolidated its shares by 200,000 to 1 since 2007. (11-Mar-2012)

Raking muck, Part 6
Concluding our hexalogy, we look at a recent deal by COMG (0254). Existing shareholders were diluted to 2.54% in an acquisition valued at HK$1242m for a business which would need capital of HK$3.6m. We estimate that the vendor has already cashed in about $1812m by selling convertible bonds and shares. We also look at what comes next for COMG, and some unfinished business for the authorities. (11-Mar-2012)

IN OTHER NEWS
SFC criticises Penta for breaches of Takeover Code
SFC, 13-Mar-2012

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