Jade Technologies’ ex-chief gets over 8 years’ jail for failed takeover
SINGAPORE — The former head of Jade Technologies was yesterday sentenced to eight years and nine months’ jail and fined S$50,000 for 39 offences related to his failed takeover bid of the semiconductor firm, which left minority shareholders in the lurch when the deal fell through.
Anthony Soh Guan Cheow, 58, is the first person to be convicted under the Securities and Futures Act for making a takeover offer when he had no reasonable grounds for believing he could see it through.
Describing the medical doctor-turned-businessman as a “scheming, lying and sophisticated crook” who had engineered the botched buyout and secret sales of shares for his benefit, District Judge Soh Tze Bian also wrote in his grounds of decision that Soh’s S$116 million offer was one that “clearly had no genuine intention ... (but was a) sham born out of desperation”.
The sentence imposed by the district judge, who found Soh guilty on July 15 this year after a 28-day trial, is the longest jail term for market rigging and insider trading offences imposed on an individual to date.
Defence lawyer Michael Khoo has indicated that Soh intends to appeal against both his conviction and sentence. Soh is now out on an S$800,000 bail.
The high-profile scandal dates back to February 2008 when Soh, who already owned close to half of Jade’s shares, had tabled a S$116 million offer to buy the remaining 54 per cent stake he did not own.
A successful buyout requires the buyer to obtain control of 50 per cent of a company’s shares.
Soh’s bid amounted to an attractive offer of 22.5 cents a share, which lured many investors to snap up Jade shares, fully expecting to sell them back to Soh, who was then the company’s group president.
Just a week before the offer deadline in April 2008, he abruptly withdrew his bid.
It later turned out that most of Soh’s shares had been pledged to Australian broker Opes Prime, and were thus seized when Opes collapsed in March that year. Jade’s share price subsequently plunged to six cents, leaving investors with hefty losses.
The court heard that Soh’s takeover offer was a centrepiece in a scheme he had devised to artificially inflate the price of Jade shares, then dump them to an unsuspecting market. This would relieve the tremendous financial pressure he had been facing since January 2008.
Prosecutors had argued that Soh’s net worth during the period was only between S$3 million and S$5 million, and he also did not possess more than S$1 million in cash.
They also charged that Soh announced his takeover offer with the aim of artificially inflating the stock price, but had no intention of completing the offer.
However, defence lawyer Khoo argued that Soh was misled by his financial advisers from OCBC, who had not raised any doubts as to the financial resources of the accused. If they did, Soh would not have proceeded to make the offer, Mr Khoo said.
The district judge found that Soh knew all along that there were no grounds for believing the required S$116 million could be raised to execute the takeover, and that Soh’s intent in making his announcement was to create a misleading appearance with respect to the company’s share price.
Yesterday, the prosecution also applied for Soh to be disqualified from acting as a director or taking part, directly or indirectly, in the management of a company after his release from prison.
It also asked for money seized in a UBS bank account to be forfeited to the State as it is the proceeds from Soh’s insider trading offences.
The prosecution’s applications will be heard at a later date.
