Wison Engineering Services Co. said its controlling shareholder Hua Bangsong is helping China’s authorities with their investigations, amid a corruption probe into executives at its one-time largest client PetroChina Co.
Wison has been informed that Hua “is now assisting the relevant authorities in the PRC in their investigations,” the company said today in a Hong Kong stock exchange filing. Wison fell 16 percent yesterday before its shares were halted.
The company said it noted recent press reports on its business relationship with PetroChina, the country’s biggest oil and gas producer whose former chairman Jiang Jiemin and four other senior executives are being investigated by the government. Wison provides consulting, engineering and construction services to chemical factories and oil refineries.
Jiang, who left PetroChina in March to head the state assets regulator, is the highest-profile official to be targeted since President Xi Jinping came to power vowing to stamp out graft. China’s State-Owned Assets Supervision and Administration Commission backed the Communist Party’s decision to place its director under investigation, it said in a statement dated yesterday and posted on its website,
PetroChina gained as much as 1.3 percent to HK$8.65 in Hong Kong as of 10:59 a.m., having tumbled 22 percent this year. Templeton Asset Management Ltd. said today it cut its holding in the stock to 4.4 percent from 5.3 percent, according to a filing to the Hong Kong stock exchange.
In its 2012 listing document, Wison said it had a nine-year business relationship with PetroChina. In the three years ending 2011, Wison said its revenue from PetroChina and its subsidiaries amounted to 63 percent, 80 percent and 58 percent of its total, according to the document. In the six months ended June 30, 2012, revenue from PetroChina was 14 percent.
“The group’s revenue recognized from contracts with PetroChina and its subsidiaries for the six months ended June 30, 2013 was insignificant,” Wison said in the statement today, adding that the company is operating normally.
PetroChina’s Beijing-based spokesman Mao Zefeng didn’t answer two calls to his office seeking comment. Cui Ying, a senior vice president at Wison, reiterated in an e-mail that its business is running as normal, declining to comment further on its relationship with PetroChina.
Hua, also Wison’s founder, became a billionaire after the company sold shares in Hong Kong in December. He and his wife Huang Xing own 79 percent of the company, according to its listing prospectus.
He began his career as a salesman at a metal screen factory in Xinghua in eastern China’s Jiangsu province. He later started a company that made petrochemical machinery and accessories, and supplied raw materials for the oil industry. In 1997, he established Wison Engineering.
Hua’s net worth has fallen 29 percent to $811 million this year, according to the Bloomberg Billionaires Index.
Wison, which has more than 3,000 employees in China, Hong Kong, Saudi Arabia and the U.S., saw revenue more than double in the first half to 1.99 billion yuan, according to data compiled by Bloomberg.