CONFIDENTIAL
It is difficult to predict the impact of delisting.
The possibility has been public for sometime and has
probably been largely discounted in the market. But the
Jardines Group does comprise some 10% of the market
capitalisation and their removal would affect turnover
and the status of the Exchange. Perhaps more important
is the possible ripple effect to other companies in the
same position. If Jardines were to delist it would
clearly be preferable for them to do so without attacking
the Hong Kong Government or the Governor (as Mr Keswick
has done in the past).
The matter falls entirely within the responsibility
of HKG, the Stock Exchange and regulatory authorities.
We are in close touch with HKG about it and recommend
against the Prime Minister raising it with the Governor. If asked it, he could say:
Hope that suitable arrangements for companies like
Jardines can be worked out.
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But this is a matter for Hong Kong Government, Securities and Futures Commission and Stock Exchange.
Whatever result should not, I hope, affect Hong
Kong's position as an international financial centre.
CONFIDENTIAL