SCMP Saturday, October 7, 2000
MTR mix-up investors gain payout
Investors in the Mass Transit Railway Corporation who received duplicate share certificates will be paid $500 each to return them.
Central Registration Hong Kong, responsible for printing the certificates, apologised yesterday for the mix-up, which marred the first day of trading in MTRC shares on Thursday.
Duplicate certificates were sent to about 1,500 people out of 610,000 small investors, fewer than first thought, the company said. A telephone hotline set up by Central Registration was jammed by callers yesterday.
Investors who returned the duplicate certificates in person to Central Registration's Wan Chai office by Friday would receive the $500 to cover "travel expenses", it said. They will receive a new share certificate in exchange. Shareholders may also return the certificates by post or through their broker, but without compensation.
The duplicate certificates were a batch that had been withheld to be reprinted because of poor quality, and were sent out accidentally.
The confusion kept some investors from trading but it emerged yesterday that the duplicates were valid and could have been sold.
As a result, Central Registration, a joint venture between HSBC and Computer Share, faced a potential bill of more than $20 million for its mistake.
Where duplicates have been sold, the company will be obliged to buy back MTRC shares to cover the extra shares issued.
Central Registration managing director David Lee Shu-yuen said the duplicate certificates represented about two million shares worth $23 million based on Thursday's closing price.
All the duplicate certificates have now been pronounced invalid and can no longer be sold.
Trading in MTRC shares will proceed as usual on Monday.