Town Health shakes up board to avoid delistingBusiness | Avery Chen 20 Nov 2019
Embattled Town Health International Medical (3886) is lobbying regulators by reshuffling its board to avoid being delisted from the Stock Exchange of Hong Kong, sources said.
Hong Kong Exchanges and Clearing (0388) revised its main board delisting rules in August last year, enabling the bourse to cancel a company's listing if its trading has been suspended for 18 continuous months. Town Health's 18-month suspension expires on January 31 next year.
The local private healthcare group revealed last week it has received resignation letters from all 13 directors, including Francis Choi Chee-ming, known as the Toy King," and his daughter Crystal Choi Ka-yee, who is also chairperson of the company, with effect after a special general meeting on December 2.
This came after Broad Idea, owned by Town Health's founder Roy Cho Kwai-chee and Francis Choi, who have a combined 18.85 percent stake, requested all directors be re-elected by shareholders. Broad Idea said it will abstain from voting in the meeting.
At next month's meeting, seven directors, excluding people in Choi's family, will seek re-election, of which four are representatives of China Life Insurance (2628). The Chinese insurance giant is the company's largest shareholder after investing HK$1.749 billion in Town Health in January 2015.
Cho was charged with conspiracy to defraud Convoy Global (1019) and the Hong Kong Stock Exchange by Independent Commission Against Corruption in May. Trading of Convoy Global was suspended in December 2017.
The Securities and Futures Commission ordered a halt in trading for Town Health shares on November 27, 2017 "on grounds that the market is misinformed, disorderly or unfair."