Here is some history of China buyouts. Harbin had been accused of gross fraud. The CEO along with others holding 31% of shares announced intent to privatize. HRBN jumped 60% on the news. Others, such as Seeking Alpha, continued to warn investors of an obvious pump and dump scenario. The privatization of Harbin was completed over the following months. Personally, I don't see ABAT/ZQPT giving notice and allowing investors to grab as many shares as possible on the cheap. In CEO Fu's famous ”coming months” address he mentions reward and punishment. It's all very interesting. We shall see.
In June 2011 China TransInfo Technology Corp, which makes geographic transportation-information software for the Chinese government, agreed to be taken private by its CEO, Shudong Xia, in a deal that values the company at $146.6 million. The acquisition was funded with a loan from CDB.
CDB also played a big role in the privatization of China Security & Surveillance Technology in September 2011, before Harbin's financial buyout.
Harbin Electric(NYSE:HRBN) doesn't want to be a publicly traded U.S. stock any longer. The Chinese electronics firm said that its chairman and CEO, Tianfu Yang, had struck a deal with Baring Private Equity Asia Group to acquire all of the outstanding shares of Harbin for $24 per share in cash. Yang already owns 31.3% of the Harbin Electric shares. Goldman Sachs is advisor to the Harbin CEO and Baring on the deal.
Some critics have speculated that CDB's financing has to do with Beijing's disagreement with Washington over cross-border regulation of accounting firms. But a person close to the matter, who asked not to be identified by name, said it's a "pure commercial decision".
One other point which has always been central to me.
ABAT and Fu clearly want to build an international name and product. They are not making"slurry coal"or "mining bromine" in China. They want to export and be a player on the world stage. They've a big, big vision here, they are also very well respected and connected by those who wield power.
My bet is right they won't walk away or go dark.
If they are making real profits and growing, they can't afford to do so.
You can't be respected when you run your shareholders into the ground. We shall see soon. He will have to dispute the inflated earnings claim and that will require turning over the books. Fu is not a leader, he is a tyrant and he should be fed to the sharks. The BOD should be casting him out, but they don't. China is not ready for capitalism, clearly!