Shenzhen Stock Exchange has recently placed public censure on Cloud Live Technology Group Co., Ltd. (hereinafter referred to as “the Company”) for the failure to perform public commitments by Meng Kai, the Company’s controlling shareholder, and person acting in concert Kizilsu Kirghiz Autonomous Prefecture Xiangeqing Investment Holding Co., Ltd. (hereinafter referred to as “Kizilsu Xiangeqing”).
It is ascertained through investigation that Meng Kai and Kizilsu Xiangeqing made commitments on November 1 2013 that within three months upon receiving gains from each sell-off of the Company’s stocks, they would voluntarily provide 30 percent of the total gains to the Company as financial aid via bank transfer and other approaches. The commitments were disclosed on November 5 2013, when the fluctuation of the Company’s stocks reached the upper limit.
Thereafter, 40 million stocks of the Company were sold by Kizilsu Xiangeqing, whose bank account received RMB 150 million sell-off gains as of October 8 2014. Subject to the aforesaid commitments, Kizilsu Xiangeqing should have provided financial aid of RMB 45 million to the Company no later than January 8 2015. According to the Company’s announcements, Meng Kai and Kizilsu Xiangeqing only provided financial aid of RMB 30 million as of April 10 2015, and there is a big uncertainty on whether the rest of financial funding could eventually be provided.
It has a great influence on listed companies to perform commitments, which are also important basis for investors’ decision-making, said by an officer in charge of this case of SZSE, honesty and promise-keeping are the obligations that must be performed by listed companies, their controlling shareholders, de facto controllers, etc. Relevant parties in this case lacked credit consciousness, on which SZSE placed a serious punishment according to rules. It is the embodiment of strengthening supervision over commitments.
SZSE has made great progress in the credit system construction for the recent years. Credit archives, regulatory measures and other information are made public on the website, WeChat or Weibo in a timely manner. Under the background of regulatory transition, SZSE will continue to strengthen efforts on supervision over commitments in the course and afterwards, and build up an effective connection between commitment performance and risk-classified supervision, so as to safeguard the rights and interests of investors.
According to the Company’s disclosure, Meng Kai and the Company are now under investigation of China Securities Regulatory Commission due to the suspicion of violating securities laws and regulations. There is risk on implementing a delisting risk warning on the Company’s stocks, and risk on being suspended from listing on the Company’s corporate bonds.
