very much doubt privatization is on the cards.
If PE firms, like MS, were to privatize a company, they certainly wouldn't make an investment in the public entity first, otherwise, they could move the spot price much higher which is not in their interest if they were contemplating a buyout.
Stung, Chinese Firms Now Look to Go Private
By DINNY MCMAHON
BEIJING—Hundreds of small Chinese companies flocked to U.S. exchanges in recent years, and investors eagerly greeted them as bets on China's surging economy.
That love affair has soured.
After a spate of recent scandals—and amid growing investor skepticism—a flurry of those companies are in talks to be taken private. In some cases, the companies plan to relist in two or three years in Hong Kong or mainland China, where valuations for such companies are now higher than in the U.S.
Shareholders saw billions of dollars in paper losses over the last year after a wave of accounting irregularities surfaced at dozens of U.S.-listed Chinese firms, prompting exchanges to delist several companies. The Securities and Exchange Commission also set up a group to investigate problems at Chinese companies listed in the U.S. As a result, investors have turned their backs on virtually the entire category, even though the vast majority of companies haven't been accused of wrongdoing.
The investor retreat has caught the attention of private equity groups. A number of them are working with the heads of Chinese companies to buy out outside shareholders, according to the companies' filings with the SEC. At least seven Chinese companies have initiated procedures for such buyouts or announced plans to, the filings show.
The deals can be dicey. Existing shareholders are sometimes dissatisfied with the prices they are offered and investor lawsuits are common, says Donald Yang, chief investment officer at Abax Global Capital, a hedge fund that is helping two Chinese companies go private. And critics, including hedge funds that short stocks, warn that some firms may be going private primarily to avoid scrutiny.
But some private-equity investors say they see an opportunity to snap up companies with experience dealing with the demands of international investors at what could be bargain prices.
"It's a perfect storm to be doing these deals...[and] there's a lot of people in the hunt," said Josh Kurtzig, a partner at Tangram Capital Partners, which is helping assemble a couple of privatization deals. "Some CEOs say that going IPO in the U.S. was the worst decision they'd ever made."
Many of these companies came to the U.S. because they were too small and lacked the influence to win a listing on China's state-run exchanges. Plus, there was ample demand from U.S. investors. Most listed through so-called "reverse mergers," which are backdoor processes that entail less regulatory scrutiny than traditional initial public offerings.
Joseph Chan, a partner at law firm Sidley Austin LLP in Shanghai, said interest in doing privatization deals started to pick up around the time the SEC started investigating allegations of fraud at Chinese firms toward the end of last year. The Bloomberg Chinese Reverse Mergers Index has fallen about 60% since mid-November, when sentiment started turning against the sector amid widening allegations of misconduct.
Among the deals in the works, Bain Capital is buying outstanding shares in Nasdaq-listed China Fire & Security Inc. for $9.00 each. That is almost 50% higher than the $6.26 closing price on March 7, when the company announced that a then-unnamed private equity fund was looking to buy it out. At that time the company's share price was 60% lower than a year earlier, despite not being implicated in the investigations or allegations swirling around the sector. It closed at $8.47 Wednesday, and currently has a market capitalization of about $240 million.
Morgan Stanley has purchased YONG stock over a period of 8-22-11 thru 8-31-11 valued at $5.9 million.
http://www.insidercow.com/history/insider.jsp?Cik=0001522730&company=YONG&name=MSPEA AGRICULTURE HOLDING LTD&title=various various various various various various va
Here is a list of all insider purchases since 2-19-2010:
Rat in Houston, TX
The objective to take a Chinese co. private is to re-list it on Chinese exchange after the 2 year waiting period.That is the last resort,the large infusion of cash right now is to partner with said co. and if the stock still does not fare well then a buyout may be placed on the table.My understanding from everything I have read.GLTA