Ong Beng Seng’s HPL jumps almost 10% in heavy trading; company says unaware of reason for spike

[SINGAPORE] Shares of Hotel Properties Ltd (HPL) jumped almost 10 per cent in active trading on Friday (May 16) morning, prompting queries from Singapore Exchange Regulation (SGX RegCo).

At about 11.30 am, the counter was up 9.2 per cent at S$4.72 with over 350,000 shares traded, an unusual volume for the tightly held property and hotel group. But by mid-afternoon, it had given up more than half the day’s gains and closed at S$4.42, up S$0.10 or 2.3 per cent.

After news broke that founder and erstwhile managing director Ong Beng Seng was stepping down, there has been talk that new players may be keen on the company. The Business Times columnist Leslie Yee also argued that with Ong’s exit, selling his stake is the logical next step.

HPL had announced on Apr 14 that Ong, 79, would relinquish his position as managing director to manage a medical condition – multiple myeloma, a form of white blood cell cancer. He also stepped down as a director of the company after not seeking re-election at the company’s annual general meeting on Apr 29.

On Friday, the local bourse regulator asked the company to explain the stock’s “unusual price movements”. Any previously unannounced materially sensitive information that may explain the trading should be disclosed promptly, SGX RegCo’s query stated.

The regulator also queried if the company was aware of other possible explanations for the trading activity, while asking HPL to affirm its compliance with listing standards. It added that, if appropriate, the company might want to request a trading halt.

Responding to the query on Friday afternoon, HPL said that it was not aware of any unannounced information that might explain the trading. It said it was in compliance with SGX RegCo’s listing rules, particularly its obligation to disclose any material information concerning the company.

Ong, known for bringing in the Formula 1 night race to Singapore, is embroiled in the high-profile conviction of former transport minister S Iswaran for accepting gifts as a minister and obstructing justice.

On Apr 24, the court granted Ong permission to leave Singapore for over two weeks, to allow the businessman time to obtain further reports from his doctors on his medical condition. A spokeperson said he would travel to England, the US and Italy between Apr 28 and May 16 for both medical and work-related purposes.

The hotelier and property magnate was named in some charges to which Iswaran pleaded guilty, including abetting a public servant in obtaining gifts, and one charge of obstruction of justice.

The Malaysian had previously been scheduled to plead guilty to both charges on Apr 2. The hearing was rescheduled to Apr 25, then again to Jun 10.