HONG KONG: PCCW's minority shareholders were anguished by yesterday's decision clearing the way for the company to be privatized.

Dozens of minority shareholders were at the High Court to hear yesterday's ruling by High Court Judge Susan Kwan.

They listened as the judge announced that Richard Li and his partners would be permitted to execute their plan to delist the telecom from public trading.

"Don't go easy (on him) because he (Richard Li) is the younger of Li Ka-shing," a minority shareholder, who identified himself as Wong, shouted in the courtroom.

Another PCCW minority shareholder sitting next to Wong echoed the words, scolding the Court and saying the ruling will significantly undermine Hong Kong's standing as a financial hub.

Judge Kwan responded to the outbursts by calling a 10 minute recess while order was restored. The two disgruntled shareholders were removed from the courtroom and the proceedings continued.

A convener of PCCW's minority shareholder group said he worries that privatization against the will of minority shareholders will multiply, now the government has lost its bid to halt PCCW's privatization. That will harm the interests of minority shareholders, he contended.

Ling King-kam, an associate director at Prudential Brokerage, said the ruling was a bad precedent. He agreed other public companies may follow suit and take unfair advantage of shareholders when share prices fall to low levels.

LegCo member Chim Pui-chung said it will cost a lot of money for the case to drag on, "although I think the transaction wasn't totally fair, the minority shareholders are better to take the privatization opportunity to offload their stocks."

Marco Mak, head of research at Taifook Securities, disagrees with others who foresee an incoming tide of privatization. "It all depends on individual cases. There are other successful privatization cases and the deal reflect big shareholders' confidence in the stock market," he said.

(HK Edition 04/07/2009 page16)