SFC Censures Wonderful Sky for Breaching the Code on Share Buy-backs

The Securities and Futures Commission (SFC) has publicly censured Wonderful Sky Financial Group Holdings Limited and Liu Tianni and publicly criticised Liu Kiki Ching Tung for breaching the Code on Share Buy-backs.

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In March 2020, Wonderful Sky bought back 42,500,000 shares by way of a block trade which was pre-arranged and pre-agreed between Wonderful Sky and the vendor. This constituted an off-market share buy-back which required the approval of the Takeovers Executive and of Wonderful Sky's disinterested shareholders, neither of which was obtained.

Liu Tianni, as the Chairman, Chief Executive Officer and an executive director of Wonderful Sky, was the main decision maker for the buy-back. Liu Kiki Ching Tung was a deputy general manager of Wonderful Sky at the material time and participated in implementing the buy-back under Liu Tianni's instructions.  

All the parties accepted that they failed to comply with the Code on Share Buy-backs and consented to the disciplinary action taken against them.

The SFC wishes to take this opportunity to remind practitioners and parties who wish to take advantage of the securities markets in Hong Kong that they should conduct themselves in accordance with the Codes on Takeovers and Mergers and Share Buy-backs. The Takeovers Executive expects persons who are actively engaged in the securities market to comply with the Codes and this includes seeking professional advice as and when needed. If there is any doubt about the application of the Codes, the Takeovers Executive should be consulted at the earliest opportunity.