HONG KONG: CEC International Holdings Ltd., operator of Hong Kong’s popular snack food chain 759, saw its shares surge the most on record after its chairman’s death triggered takeover interest from a rival.
Just two days after CEC announced Chairman Lam Wai Chun had died, Lin Tsz Fung, chairman of rival Best Mart 360 told Apple Daily newspaper that he’d be interested in acquiring CEC as long as the price is less than HK$1 billion (US$127 million). CEC jumped 91% to close at 89 Hong Kong cents Monday, giving the company a market value of HK$593 million and posting the biggest gain since 1999 when it began trading.
Fung later clarified in a statement that he doesn’t have plans to acquire the rival and that the HK$1 billion figure is his personal evaluation of CEC’s potential market value. Still, trading volume surged to 166 million shares, more than 300 times its 3-month average level. The company also appointed Executive Director Tang Fung Kwan as its new chairman, according to an exchange filing.
The food chain, which mainly sells imported Japanese products, reported losses in the past three years, citing weak retail demand in the territory.