A billionaire Chinese dealmaker has gone missing, plunging one of the country’s top investment banks into turmoil.
Bao Fan, the founder and executive director of China Renaissance, is a major figure in the Chinese tech industry and has played an important role in the emergence of a string of large domestic internet startups.
Shares in China Renaissance slumped after the bank announced to the Hong Kong stock exchange on Thursday that it had been unable to contact Bao, without giving further details.
The stock plunged 50% at one point after the statement, before clawing back to about 30% down.
According to the financial news outlet Caixin, the 52-year-old had been unreachable for two days as of Thursday evening.
The executive committee of China Renaissance told employees not to worry in a message on Friday morning. “[We] believe that everyone has had a restless night. At this time, [we] hope that you do not believe in or spread rumours,” the message said, according to the Wall Street Journal.
Bao’s disappearance is raising concerns over a possible renewed crackdown on China’s finance industry as President Xi Jinping persists in his longstanding campaign against corruption.
The Chinese government has cracked down on several big industries, including technology, education and real estate, as part of Xi’s “common prosperity” drive to “keep income distribution and the means of accumulating wealth well-regulated”.
At least six billionaires have been cowed under Xi, including Jack Ma, the founder of the e-commerce giant Alibaba, who disappeared for three months in 2020 after criticising market regulators.
Willer Chen, a senior analyst at Forsyth Barr Asia, told Bloomberg the executive’s absence “could be a long-term overhang on the stock, given Bao is the key man for the company”.
Wang Wenbin, a spokesperson for China’s foreign ministry, said he was “not aware of the relevant information” when asked about Bao’s disappearance.
“But I can tell you that China is a country under the rule of law,” he said. “The Chinese government protects the legitimate rights of its citizens in accordance with the law.”
China Renaissance has developed into a global financial institution, with more than 700 employees and offices in Beijing, Shanghai, Hong Kong, Singapore and New York.
Bao founded the bank in 2005 after working at Morgan Stanley and Credit Suisse. He competed against Wall Street stalwarts to win mandates on huge deals and stock market listings.
The group has supervised the initial public offerings of several domestic internet giants, including that of the leading e-commerce firm JD.com. Bao also facilitated a 2015 merger between the ride-hailing firm Didi and its main rival at the time, Kuaidi Dache.
Desmond Shum, a Chinese former tycoon, speculated that Bao may have been a target because of his insider knowledge of such deals. Mergers of big companies often involve political as well as business connections.
The case of China Renaissance is reminiscent of a pattern of investigations into the country’s leading financiers in recent years.
In 2017, the Chinese-Canadian businessman Xiao Jianhua was arrested by mainland authorities and received a 13-year jail sentence under corruption charges last August.
Known to hold close ties to top Chinese Communist party leaders, the billionaire was reportedly abducted from his Hong Kong hotel room by plainclothes police officers from Beijing. At the time of his arrest, Xiao was one of the richest people in China, with an estimated fortune of $6bn.
According to Caixin, the China Renaissance president, Cong Lin, was taken into custody last September as authorities launched an investigation into his work at the financial leasing unit of the state-owned bank ICBC.