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Macquarie Analyst Thrown Out of PAX Global Briefing After Heated Exchange

Macquarie Group AGM Media BriefingMacquarie Group AGM Media Briefing
A woman walks past the Macquarie Group Ltd. logo displayed at the company's headquarters in Sydney, Australia, on Thursday, July 28, 2011. Ian Waldie/Bloomberg via Getty Images/File

A Macquarie analyst was told to leave an earnings briefing held by China’s PAX Global Technology (PXGYF) after a heated exchange with the company’s chief financial officer that was videotaped and later circulated on social media.

In the video, CFO Chris Lee told Macquarie’s Timothy Lam during the briefing on Wednesday to leave immediately.

“You don’t do your job. You didn’t do your job. Go out,” Lee said, adding that if he didn’t leave he wouldn’t say anything and that Lam had no right to be there.

Lee did not elaborate on his reasons for asking Lam to leave in the video, which was reviewed by Reuters and its contents confirmed as authentic by another analyst at the briefing.

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The incident comes amid growing fears over a clampdown on negative research in Hong Kong after the securities regulator pursued Moody’s Investor Services and U.S-based activist short seller Andrew Left of Citron Research over separate reports they published raising corporate governance concerns about Chinese companies listed in Hong Kong.

Lam was the only analyst with a sell rating among 12 analysts that cover PAX Global, prior to the meeting on Wednesday, according to Thomson Reuters Eikon data.

PAX Global, which is an electronic funds transfer solution provider and has a market value of $980 million, said the incident was “one-off” and did not represent the standpoint of management.

“I would like to express my regrets as to my own behavior during the briefing yesterday and welcome all the diverse points of view and perspectives toward the company and myself,” Lee said in a statement.

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After the meeting, Lam issued an analyst report entitled “Asked to leave the meeting.” In it, he wrote: “We believe all analysts should be able to attend analyst briefing, regardless of their view on the company.”

Lam could not be reached for comment and Macquarie declined to comment.

Shares of PAX Global fell more than 4% on Thursday to HK$6.48, lagging a flat broader market.

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Another brokerage Nomura downgraded the company from neutral to reduce and cut its target price to HK$6.30 after the analyst meeting.

In a report, Nomura wrote PAX had not fully caught up with local competitors in the low-end segment and the China market was facing rising uncertainty due to a central bank policy of renewing licenses of all third-party payment service providers (PAX’s major customers) in the second half.

“While we do not judge this dispute (the CFO asking an analyst to leave), we think this may hurt PAX Global’s shareholder value,” Nomura said.