Shares in firms controlled by one of China’s best-known entrepreneurs were suspended in Hong Kong and the mainland after a financial magazine said Fosun International Ltd (復星國際) had lost contact with billionaire founder and chairman Guo Guangchang (郭廣昌).
The report by online publication Caixin late on Thursday quoted unidentified sources as saying the conglomerate had been unable to reach Guo since noon that day.
The self-styled student of investor Warren Buffett underlined his global ambitions earlier this year, closing a billion-dollar takeover of the Club Med resort chain.
Photo: Bloomberg
In a statement yesterday, Fosun International said it had requested a trading halt pending the release of an announcement, at an undisclosed time, containing what it described as “inside information.”
A Fosun International spokesman in Hong Kong said the firm was operating as normal, declining to comment on the report or Guo’s whereabouts.
If confirmed, Guo’s absence would make him the most high-profile of a string of senior executives of top Chinese companies found to have gone missing temporarily. That would send a strong signal that Beijing is serious about ramping up scrutiny of China’s financial sector in a widespread anti-corruption crackdown.
CITIC Securities Co Ltd (中信證券), China’s biggest brokerage, said on Sunday it was not able to contact two of its top executives following media reports that they had been asked by authorities to assist in an investigation.
“Guo is one of the high-profile Chinese entrepreneurs and this incident will raise eyebrows among foreign regulators as Fosun has been aggressively expanding its global insurance footprint,” Moody’s analyst Sally Yim (嚴溢敏) said.
“But it is too early to say how this incident will impact Fosun’s operations,” she said.
Fosun and Guo were named by a Chinese court in August in relation to a bribery case against Wang Zongnan (王宗南), former chairman of state-owned Bright Food Group Co (光明食品), who was sentenced to 18 years in jail.
State news agency Xinhua said at the time Wang’s parents had bought two villas in Shanghai developed by Fosun at below-market prices, and that Wang had used his position to seek benefits for Fosun. The latter said it had “never sought to inappropriately benefit” and had “never delivered benefits to Wang Zongnan.”
After the Caixin report was published, Fosun’s overseas depositary receipts in New York fell 6.6 percent overnight in unusually heavy over-the-counter trading, according to Thomson Reuters data.
Guo, 48, has built an overseas empire of industrial companies, alongside a host of insurance, banking and asset management firms. He is a delegate to the Chinese People’s Political Consultative Conference and has amassed a personal net worth of US$5.7 billion along the way, according to Forbes.
Since it was founded in 1992 by Guo and three fellow graduates of Shanghai’s Fudan University as a startup with initial capital of US$4,000, Fosun has spent more than US$30 billion in buying foreign assets.
These have ranged from Portuguese insurer Fidelidade-Companhia de Seguros in January to slices of theater company Cirque du Soleil and holiday operator Thomas Cook Group PLC.
China watchers said any confirmation that Guo faces specific scrutiny from regulators would reverberate around the international investment community.
“Should Guo, well-known abroad, be found to be at the center of a graft investigation, this would be a strong signal to the world that China is serious about its anti-corruption campaign,” said Alberto Forchielli, founder of private equity firm Mandarin Capital Partners (曼達林投資) with 20 years of experience in China.
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