Financially troubled Hanergy Thin Film (HTF) is on the lookout for new investors as it seeks to improve its finances and return to trading, Reuters reports.
HTF has tapped China International Capital Corp (CICC) to find a strategic investor, according to the new agency, which cites two sources in the know.
The company, headed by billionaire Chairman Li Hejun — one of China’s wealthiest businessmen — is under investigation by the Hong Kong Securities and Futures Commission (HKSFC). According to Reuters, the investigation centers on possible market manipulation. While the Hong Kong regulator has confirmed the probe against HTF, it has declined to provide details. The HKSFC has been investigating the company since May, when its shares plunged nearly 50% in less than 30 minutes, wiping out $19 billion from its market value.
The HKSFC ordered the continued suspension of HTFs shares from trading the following July a call the watchdog is allowed to make when it suspects misleading, false or incomplete information has been included in documents or statements.
According to Reuters, HTF had been searching for a strategic investor for the past six months to no avail and turned to CICC, one of Chinas oldest investment banks, for help.
Despite Li’s powerful connections, one source told Reuters that no one would want to put money into this hole now; you don’t know when it’ll ever start trading again."
Last month HTF issued a warning of substantially decreased revenues for 2015. The company has also reported ongoing problems with its parent company, Hanergy Holding, which it said had failed to pay some $330 million in overdue overdue payments, further negatively affecting the 2015 results.
HTF had reportedly offered to cut ties with Hanergy Holding — its main source of revenues — and its corporate affiliates as part of a restructuring plan aimed at addressing HKSFC concerns, but has since canceled the move after it was rejected by the watchdog as inadequate.