Benzinga -
- Tencent (HK:0700) Holding Ltd (OTC: TCEHY) backed Chinese online broker Futu Holdings Limited (NASDAQ: FUTU) unexpectedly deferred its Hong Kong listing less than a day before its anticipated debut on December 30.
- Futu said it was "clarifying certain matters" with the Hong Kong Stock Exchange.
- Futu was the latest U.S.-listed Chinese firm to bid to dual list its shares in Hong Kong to reach a broader investor base and hedge against the risks of getting kicked off U.S. exchanges.
- Also Read: Pinduoduo And Other US Listed Chinese Tech Companies Abort Dual Listing Options
- Futu and its main rival UP Fintech Holding Limited (NASDAQ: TIGR), operated in a gray area for their mainland China businesses, Bloomberg reports.
- The companies enabled millions of local investors to evade capital controls to trade shares in markets such as Hong Kong and New York.
- A senior central bank official has questioned the legitimacy of online trading firms, calling their services "illegal" at least twice since last 2021.
- The last-minute delay "raises red flags" and "could be of concern to investors and tarnish its profile among retail clients in its largest market," Bloomberg Intelligence analyst Sharnie Wong wrote.
- Tencent is Futu's second biggest shareholder after billionaire founder Leaf Li.
- Price Actions: FUTU shares traded lower by 27% at $42.95 on the last check Friday. TIGR shares traded lower by 29% at $3.37.