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Investors Sue China Resources Power over Cheating

07-18 16:14 Caijing
The HK-traded company was accused of purchasing mining rights of two mines from Jinye Group, a private company in Shanxi, which was proved not the owner when the deal was announced.

Six shareholders of China Resources Power Holdings Company Ltd have filed a lawsuit against 20 board directors of the company for buying defective assets and keeping it from investors.

The HK-traded company was accused of purchasing mining rights of two mines from Jinye Group, a private company in Shanxi, which was proved not the owner when the deal was announced.

Documents showed mining right of one had already been expired in 2007 while the other had ended in 2009, long before the deal was nailed in 2010.

Both sides of the deal knew it, said CEO of Hejun Consulting Li Su at a press release Thursday in Beijing.

The press briefing was held a day after a correspondent with a Xinhua-run newspaper, accused senior officials, including the chairman with China Resources of bribery on Sina Weibo, of bribery and other wrongdoings another online crackdown on corruted officials in China. 
 
Wang Wenzhi, the correspondent, also accused the company’s directors of causing huge losses of state assets.

China Resource Power Holdings Ltd., a subsidiary of state-owned China Resources, spent 12.6 billion in a takeover of assets from Jinye Group in April, 2010.

The six shareholders also accused the company of violating securities laws without disclosing any information about the ten-billion deal over the last three years.

China Resources Power explained later in a statement that it was an associated company, not a subsidiary that completed the acquisitions and its stake in the company is not big enough to be obliged to disclose informaiton.

The case has been accepted by the HK Supreme Court and a trial will be open on August 5th. All the six investors are HK residents.

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