Fosun Group Denies Link to Money-for-Power Deal After Verdict

Fosun Group, the closely held conglomerate backed by billionaire Guo Guangchang, denied any link to a bribery case following a court verdict implicating a former executive at Shanghai Friendship Group Inc. and Bright Food Group Co.

Fosun Group gave home-purchase discounts to Wang Zongnan, former chairman of Bright Food Group, who exploited his office when working as general manager of Shanghai Friendship Group, China’s official Xinhua News Agency said Tuesday. Wang was sentenced to 18 years in prison for embezzlement and bribery, Xinhua said. Guo, chairman of Fosun Group, granted favors to the executive, although he wasn’t accused of wrongdoing, according to the Xinhua report.

Fosun Group, in a rare move, denied any link to Wang’s bribery on Tuesday, saying it didn’t seek inappropriate benefits in cooperating with Shanghai Friendship Group nor did Wang transfer interests to Fosun, according to an official WeChat account statement.

Wang had approached Guo to purchase two villas in 2003 developed by Fosun Group’s property arm, and Guo agreed to sell them, the Xinhua report said. Fosun sold two villas in west Shanghai’s Songjiang district to Wang’s parents for 2.1 million yuan, or about 2.7 million yuan less than the villa’s market value at that time, Xinhua said. The two villas were sold in 2010 and 2013 for a total of 14.8 million yuan, the report said.

The discount was “at a normal range” in an “extreme property downturn” in 2003, Fosun said in statement. The firm firmly upholds China’s anti-corruption campaign, it said.

Wang resigned as chairman of Bright Food Group controlled by the Shanghai government in November 2013. He helped oversee China’s second-largest food company during its streak of overseas acquisitions, including buying a 60 percent stake in British cereal maker Weetabix Ltd in 2012 and 75 percent of Australia’s Manassen Foods in 2011.

— With assistance by Emma Dong

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