HONG KONG (Nikkei Markets) -- Shares of entertainment services provider Camsing International Holdings plummeted as much as 90% in Hong Kong trading on Monday after the company said its Chairman and controlling shareholder was being held in criminal custody in Shanghai for unknown reasons.
Camsing was made aware on Friday that Lo Ching, who holds a 64.87% stake in the company, was in the custody of the Yangpu branch of the Shanghai Public Security Bureau, Camsing said in a filing to the stock exchange.
"As at the date of this announcement, the directors are unable to ascertain the reasons of, or incidents leading to, the criminal custody of Ms. Lo," the statement said, adding that business operations have remained stable, and not adversely affected by the development. "The board will endeavor to ensure the continued operations of the group."
Shares of Camsing were down 88.5% at 53 Hong Kong cents as of 10:33 a.m. on Monday, taking the company's market capitalization to less than HK$600 million ($76.9 million). They fell as low as 46 Hong Kong cents earlier. More than HK$200 million of shares had changed hands. The city's benchmark Hang Seng Index was down 1.8%.
Steven Leung, executive director at UOB Kay Hian (Hong Kong), said the development at Camsing appeared to be similar to mainland developer Future Land Development Holdings, whose chairman and controlling shareholder Wang Zhenhua was detained last week, leading to a slump in Future Land's shares.
Wang was reported by the company as being held by the Shanghai Public Security Bureau "in criminal custody for personal reasons." Future Land's board replaced him with non-executive director Wang Xiaosong with immediate effect.
Camsing's stock price slump reflects worries about possible changes in the company's ownership and its ability to repay any borrowings, UOB Kay Hian's Leung said.
-- Carrie Chen
