China Renaissance shares climb after statement on missing chairman

Shares of China Renaissance Holdings rose as much as 9 per cent on Monday (Feb 27) after the boutique bank said its missing chairman was cooperating with Chinese authorities in an investigation.

The Beijing-based investment bank, which did not disclose details on the investigation involving Bao Fan or specify which authorities, reiterated that the company’s business and operations remained normal.

China Renaissance shares climbed to as much as HK$7.74 in early trade on Monday, the highest since Feb 22, before trimming gains to HK$7.34, still up 3.4 per cent, compared to a 0.8 per cent decline in the benchmark Hang Seng Index.

The stock dived 50 per cent on Feb 17 after the boutique bank said it was not able to reach its chairman and controlling shareholder Bao, a famed deal maker who has been involved in a series of major Chinese technology mergers.

“We can only say the negative factor affecting the share price has been digested,” said Alex Wong, director of Alex KY Wong Asset Management Company Ltd in Hong Kong.

Monday’s share price gain was “limited” compared with the previous plunge, Wong said, adding that the company’s update on Bao’s whereabouts was not particularly positive piece news nor negative.

Reuters reported on Feb 20, citing two sources familiar with the matter and some media reports, that authorities took Bao away earlier this month to assist in an investigation into a former colleague, Cong Lin, the company’s former president.

The dealmaker’s disappearance is the latest in a series of cases of high-profile Chinese executives going missing with little explanation during a sweeping anti-corruption campaign spearheaded by President Xi Jinping.

In 2015 alone, at least five executives became unreachable without prior notice to their companies, including Fosun Group Chairman Guo Guangchang, who Fosun later said was assisting with investigations regarding a personal matter.

Bao was involved with major technology mergers including the tie-up of ride-hailing firms Didi and Kuaidi, food delivery giants Meituan and Dianping, and travel devices platforms Ctrip and Qunar.