China Renaissance Holdings Ltd (1911.HK) noticed its shares plummet via as plenty as 50% on Friday after the funding bank stated it’s far not able to contact its Chairman and Chief Executive Bao Fan, within the modern-day disappearance of a pinnacle commercial enterprise government.
The disappearance of Bao, the company’s founder and controlling shareholder, drove China Renaissance’s Hong Kong-listed stock to hit a record low of HK$5 in early trade, wiping off HK$2.Eight billion ($357 million) in marketplace fee.The inventory regained some ground later inside the day to be off with the aid of 28% within the Hong Kong market which became down zero.7%. Nearly 30 million shares of the boutique funding financial institution changed fingers on Friday, the highest on document.
“The board isn’t always privy to any records that suggests that Mr. Bao’s unavailability is or might be associated with the business and/or operations of the Group that’s continuing usually,” the mainland China-primarily based bank stated in a late-Thursday filing.
A China Renaissance spokesperson referred Reuters’ request for comment on Friday to the funding financial institution’s public submitting.
The well-known dealmaker’s disappearance is the modern-day in a chain of instances of high-profile Chinese executives going missing with little rationalization for the duration of a sweeping anti-corruption campaign spearheaded by means of President Xi Jinping.
In 2015 on my own, at the least 5 executives became unreachable with out prior word to their groups, which include Fosun Group Chairman Guo Guangchang, who Fosun later said turned into helping with investigations regarding a non-public rely.
The disappearance comes after China’s border reopening and renewed cognizance on boosting the sagging economic system has brightened the outlook for deals, as has an easing of a regulatory crackdown on technology corporations.Bao who previously worked at Credit Suisse Group AG (CSGN.S) and Morgan Stanley (MS.N), has been hailed as one in all China’s quality-related bankers.
He changed into concerned with predominant era mergers along with the tie-up of journey-hailing companies Didi and Kuaidi, food shipping giants Meituan (3690.HK) and Dianping and travel devices platforms Ctrip (9961.HK) and Qunar.
Deals Adviser
“If a listed company voluntarily discloses that a senior manager or a chief shareholder cannot be contacted, it is honestly unusual, because the individual could have been out of reach for a while,” said Dickie Wong, executive director of studies at Kingston Securities.
Investors’ worst nightmare is that a corporation’s potential to continue operation is impaired, so a stock promote-off isn’t sudden given the uncertainty, Wong added.
At the helm of China Renaissance, Bao has taken an increasingly lively function in the institution’s non-public equity commercial enterprise in recent years, in step with assets with direct understanding of rely.
The sources declined to named because of sensitivity of the matter.
China Renaissance is presently ranked ninth on China’s equity capital markets leagues table for 2023, in keeping with Refinitiv, after it advised on Jiangsu Sanfame Polyester Material (600370.SS) $363 million convertible bond remaining month.
The firm earned $20.6 million in Chinese-associated investment banking costs in 2022, down from $forty three.Thirteen million a 12 months in advance, the information showed.
Bao began China Renaissance in 2005 and listed it in Hong Kong in 2018 after elevating $346 million.
The bank has acted as adviser for a number of China’s largest tech preliminary public services (IPOs) inclusive of the ones of JD.Com Inc and Kuaishou Technology (1024.HK) as well as Didi’s New York list in 2021.
Didi ran afoul of the Chinese regulators while in 2021 it pressed in advance with the U.S. Inventory list in opposition to the regulator’s will, assets formerly instructed Reuters.
China Renaissance is also an active investor in the tech area. In 2019, it raised greater than 6.Five billion yuan ($945 million) in a yuan-denominated fund.
Bao’s disappearance comes days after belongings developer Seazen Group Ltd (1030.HK) said it became not able to touch or reach its vice-chairman.