Trading in shares of China's Li Ning halted
Trading in shares of both Chinese sportswear brand Li Ning Co Ltd and a sports talent management company controlled by its founder was suspended on Thursday, pending the release of an announcement.
Li Ning, which is backed by Singapore sovereign fund GIC and U.S. private equity fund TPG Capital, and Viva China Holdings Ltd gave no further details in brief statements to the Hong Kong stock exchange.
On Wednesday, Li Ning's stock tumbled 5.3 percent after a Hong Kong media report said the sportswear sector still faced an inventory overhang, one of the thorniest problems facing retailers in China.
A former Olympic gymnast, Li Ning said in October he was selling a stake in China's best-known sportswear group to his talent management firm Viva China for HK$1.36 billion ($175 million), as the sports sector grapples with an economic slowdown and fierce competition.
In December, Li Ning warned it would post a substantial 2012 loss due to as much as $288 million in expenses under a plan to buy back inventory from distributors.
Li Ning, which competes with the likes of Nike Inc and ANTA Sports Products Ltd, said the plan was needed to put its distributors back on a long-term growth path amid fierce competition in a saturated industry.
Shares in Li Ning, which has a market value of $846 million, are still up more than 23 percent so far this year, while Viva China has risen 19 percent, outpacing a 4 percent gain in the benchmark Hang Seng Index.
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