The founder and CEO of one of China’s top investment banks has become unreachable, according to his company, China Renaissance Holdings Ltd., spooking investors and sending shares plummeting on Friday.
Bao Fan, a veteran dealmaker and billionaire tech investor, is the latest in a recent string of disappearances among top Chinese executives.
In a late Thursday filing to the Hong Kong stock exchange, China Renaissance stated that it “has been unable to contact” Bao, its CEO, chairman and controlling shareholder. It’s unclear how long he has been gone but Chinese reports say Bao hasn’t shown up to his office or been seen in public for a number of days.
“The board is not aware of any information that indicates that Mr. Bao’s unavailability is or might be related to the business and/or operations of the group,” the firm said in the filing, noting the company is still running as normal.
At its lowest point on Friday, China Renaissance’s shares were down 50 per cent, to a record low of HK$5 in early trade, wiping off HK$2.8 billion ($480 million) in market value.
The stock regained some ground later in the day to end at 28 per cent down. Nearly 30 million shares of the boutique investment bank changed hands on Friday, the highest on record.
“If a listed company voluntarily discloses that a senior manager or a major shareholder cannot be contacted, it’s truly unusual, as the person might have been out of reach for some time,” said Dickie Wong, executive director of research at Kingston Securities.
The investors’ worst nightmare is that a company’s ability to continue operations is impaired, so a stock sell-off is not surprising given the uncertainty, Wong added.
Bao’s disappearance follows a series of cases of high-profile Chinese executives going missing with little explanation, including a member of Bao’s own investment bank.
Since 2012, Chinese President Xi Jinping has spearheaded a sweeping anti-corruption campaign that has led to the investigation and prosecution of hundreds of civil servants, military officials and powerful business executives.
In September 2022, former China Renaissance president Cong Lin was taken away by Chinese authorities, according to Chinese media outlet Caixin.
Days before Bao’s disappearance, property developer Seazen Group Ltd. reported that it was unable to contact its vice-chairman.
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 previously worked at Credit Suisse and Morgan Stanley and has been hailed as one of China’s best-connected bankers.
Bao started China Renaissance in 2005 as a two-person team, seeking to match capital-hungry startups with venture capitalists and private equity investors. Since then, it expanded into services including underwriting, sales and trading.
In 2015, Bao helped broker a merger between Meituan and Dianping, China’s two leading food delivery services. Today, the combined “super app” is used widely across the country.
China Renaissance is currently ranked ninth on China’s equity capital markets league table for 2023, according to Refinitiv.
— With files from Reuters
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