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Danish ISS shares plunge on concerns over its role in deadly Hong Kong apartment fire

Danish ISS shares plunge on concerns over its role in deadly Hong Kong apartment fire

By Swedan Margen

Fashion

ISS shares slumped in Copenhagen amid concerns over the Danish company’s role in the renovation of a Hong Kong apartment fire where a deadly fire broke out on Nov 26.

The stock slid as much as 11 per cent, the most since April, after reports that a unit of ISS was acting as property manager in the Wang Fuk Court apartment complex at the time the fire broke out. Its role included arranging for services to be carried out by third-parties ultimately appointed by the building’s Incorporated Owners (IOs), the company said in a statement.

The news was first reported by the South China Morning Post.

“Tendering of the major renovation of Wang Fuk Court was conducted under the IOs procedures on an authorised e-tendering platform, with full transparency,” ISS said in a statement.

“The extent of ISS EastPoint Properties Limited’s involvement in the tendering process was administrative – it did not extend to making recommendations or the decision-making process,” it said, adding that the company welcomes the decision by Hong Kong authorities to establish a judge-led independent committee.

Bloomberg has reached out to ISS for additional comment.

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I will establish an independent committee to conduct comprehensive and in-depth review to reform the building work system and prevent similar tragedies from occurring in the future,” says the city’s leader John Lee.
Contractors working on the renovations used the substandard materials in hard-to-reach areas, effectively hiding them from inspectors.

According to Per Hansen, investment economist at Nordnet, “an investigation can be costly, lengthy, and brings uncertainty and a higher risk premium.” He said investors may also worry that the stock could be targeted by short sellers, which would put further pressure on the share price. Even after Tuesday’s (Dec 2) drop, ISS shares are still up more than 50 per cent over the past year.

Earlier Tuesday, Hong Kong’s leader John Lee held his first weekly briefing since the fire tore through a high-rise estate killing at least 156 people, and leaving 30 missing.

A judge will lead the committee to review systemic causes behind the fire and its results will be made public. BLOOMBERG

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Originally published by businesstimes.com.sg. Syndicated material does not necessarily reflect the views of Grazia British.

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