Singamas shares plunge after US DOJ allegations against CEO Teo Siong Seng

[SINGAPORE] Hong Kong-listed Singamas Container’s shares fell sharply after US Department of Justice (DOJ) allegations of price fixing involving its chief executive Teo Siong Seng, even as the company said the shipping veteran has not been served with any legal papers.

Shares of Singamas fell by more than 15 per cent on the Hong Kong exchange on Thursday (May 21) morning, after a trading halt requested by the firm was lifted.

Teo is Singamas’ executive director, chief executive and chairman of its board of directors.

The shipping container firm is a subsidiary of shipping company Pacific International Lines (PIL), where Teo is executive chairman.

In a May 20 filing on the Hong Kong exchange, Singamas said: “Neither the company nor Teo has been served with any legal process or other legal documentation by the US DOJ in relation to the matter”.

The firm added that it has engaged external legal advisors, and that business operations and day-to-day activities will remain normal in the meantime.

“The company will continue to monitor the situation closely and will make further announcements as and when appropriate in accordance with the listing rules,” it said.

Singamas, which was founded in 1988, opened its first container factory in Shanghai in 1990. It is a “leading manufacturer of containers, operator of container depots, and provider of logistics services”, according to its website.

Teo is one of seven executives the US has accused of colluding to fix the prices of dry containers, from November 2019 until at least January 2024.

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The US DOJ said prices of standard shipping containers were said to have roughly doubled between 2019 and 2021 as a result.

This allowed four of the world’s largest shipping container manufacturers to increase their profits by almost a hundredfold during the Covid-19 pandemic and the global supply chain crisis that followed, the department said.

Besides Singamas, the other companies are China International Marine Containers, CXIC Group Containers and Shanghai Universal Logistics Equipment.

Teo, who is also chairman of the Singapore Business Federation (SBF) and sits on the Singapore Economic Resilience Taskforce, was allegedly told about the plans to artificially restrict container production, which contributed to the rise in price of containers.

Singamas saw its net income rebound from a loss of around US$110 million in 2019 to a profit of about US$186.8 million in 2021.

The Straits Times has contacted Teo, Singamas, PIL and SBF for comment. THE STRAITS TIMES