The market uncertainty afflicting solar and other investors as the U.S.-China trade war shows no signs of abating was aptly illustrated yesterday by the travails of mono solar manufacturer and lithium-ion battery storage company Comtec Solar.
The Shanghai business is currently preparing to bundle every four of its shares into one new unit in a bid to comply with Hong Kong stock market guidelines about ensuring listed company shares do not fall below HK$0.01 (US$0.0013) in value.
In mid June Comtec announced a shares subscription which would involve two Hong Kong-based investors signing up for more than 72.7 million shares each, amounting to a 3.24% slice of the enlarged company.
Under the terms of the offering the unnamed investors – a Hong Kong company owned by investor Chu Wah Wai and a tech investor resident in the territory who already owned 0.22% of Comtec – would benefit from a 20% discount on the HK$0.068 average price of the shares traded in the ten days before the shares subscription.
Comtec announced the results of the subscription yesterday, by which time the HK$0.055 paid by the investors for the stock represented a price 19.57% higher than the HK$0.046 it was trading at. The reversal in fortune does not appeared to have dismayed the investors, however, who ultimately signed up for a total of 270 million shares – 12.04% of Comtec before the shares subscription was factored in.