Just days after missing out on Ping An Trust's "QDII Equity-Linked Structured Product - Unlisted Facebook Equity Trust Product" (reported in Edition 23 on January 6, 2011 and February 10 in the article "Goldman Sachs Accused of Flipping Facebook Shares; Ping An Trust Quietly Sells to Mainland Rich" and "Ping An Trust Stumbles on Facebook; Chinese Tycoons Miss IPO Bonanza"), Wang Gang (a pseudonym), the head of a large domestic private enterprise, unexpectedly received a call from CICC (Hong Kong). This reignited his hope of capitalizing on the Facebook IPO bonanza.
Despite Facebook having already submitted its IPO application to the U.S. Securities and Exchange Commission (SEC), which seemed to have solidified the equity structure, CICC's Private Banking Department in Hong Kong was still quietly offering high-end Chinese investors a "shortcut" to invest in Facebook's unlisted shares.
"Compared to Ping An Trust, which was forced to suspend sales of its trust products due to not keeping up with Facebook's IPO timeline, high-net-worth individuals can be introduced by CICC (Hong Kong) to directly sign share transfer agreements with the sellers of Facebook equity. Techniques such as nominee holding can be used to bypass restrictions imposed by Facebook due to its IPO filing," revealed a person close to CICC (Hong Kong). However, CICC (Hong Kong) does not participate in specific investment term negotiations, acting merely as a transaction facilitator.
For Wang Gang, who has limited experience in overseas company equity investments, this is akin to crossing the river by feeling for stones. How many variables are there?