Newly listed menswear firm Fujian Nuoqi Co. (01353.HK) has lost more than half of its value since July 18 amid rumors that the company president and his wife have absconded with a large sum of money, sina.com reported Thursday.
Fujian Nuoqi is listed on the main board of the Hong Kong stock exchange and its value slumped to HK$1 Wednesday from HK$2.15 on July 18. Trading in the stock was suspended at 11:25 am Wednesday.
In a weibo post, the general manager of a Quanzhou footwear company accused Nuoqi president Ding Hui and his wife Chen Ruiying of defrauding several parties and leaving a pile of debt behind them, the report said.
In a stock exchange filing Monday, the company’s board said it is unaware of “any reasons for such decreases in the price and increases in the trading volume of the shares” or of “any information which must be announced to avoid a false market”. It also said it did not know of “any inside information that needs to be disclosed”.
But, according to unidentified sources, the company’s cornerstone investors offloaded their shares, triggering the share price slump.
Nuoqi raised a total of HK$320 million in its initial public offering in Hong Kong in January. Before that, it filed to list on the mainland’s A-share market in March 2011 but regulators rejected the application over concerns about operational risks, its low expenditure on marketing and R&D, and its limited geographical presence. It applied again six months later but was caught up in the regulator’s freeze on IPOs.
Nuoqi had 438 company and franchised retail points across the country as of October 31, 2013. It claims to be one of the first companies in China to adopt a market-driven, fast-fashion business model.
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