Billionaire Guo Assisting Probe After He's Reported Missingby
Companies controlled by Guo reveal his participation in probe
Former Shanghai vice mayor is government target, people say
Chinese billionaire Guo Guangchang, who leads Fosun International Holdings Ltd., is assisting judiciary authorities with a probe, according to a filing to the Shanghai Stock Exchange by a company he controls.
Guo had gone missing on Thursday, spurring speculation in the Chinese media that he was helping with a government investigation. Guo is assisting an investigation into former Shanghai vice mayor Ai Baojun, according to people familiar with the situation who asked not to be identified because they aren’t authorized to speak on the matter.
Guo, 48, who has called himself a student of Warren Buffett, has built a global empire spanning everything from insurance and holiday resorts such as Club Mediterranee SA to entertainment through dozens of deals over the past three years. Reports that Guo couldn’t be reached reverberated through markets, halting shares of many companies linked to his conglomerate.
Shanghai Fosun Pharmaceutical (Group) Co., which is linked to Guo’s conglomerate, plans to resume the trading of its shares in Shanghai on Dec. 14 after its suspension on Friday, the company said in the filing. Guo can continue to participate in the company’s major decisions "via appropriate means," according to the filing. The company is developing drugs, consolidating businesses in China and targeting acquisitions overseas.
Fosun International Ltd., the Hong Kong-listed unit that also stopped trading Friday and will resume on Monday, has $2 billion of acquisitions announced this year that haven’t been completed. The company is competing for Anglo-German banking group BHF Kleinwort Benson Group and agreed to acquire Israeli insurer Phoenix Holdings Ltd. in June. The company is in the process of acquiring German private bank Hauck & Aufhaeuser Privatbankiers KGaA and is among investors offering to take Chinese movie studio Bona Film Group Ltd. private.
Fosun’s stock tumbled 16 percent to $1.30 in over-the-counter trading in New York Friday, following a retreat of 11 percent on Thursday. About 166,000 shares traded hands, which is more than 22 times the daily average volume of the past three months, data compiled by Bloomberg show.
Guo’s conglomerate spent $5.7 billion over two years acquiring insurance assets, according to data compiled by Bloomberg. The insurance businesses, such as Portugal’s Cia de Seguros Fidelidade Mundial SA and Bermuda-based Ironshore Inc., provide low-cost funding for acquisitions in other industries.
In August, Guo said that his company aimed to grow its private banking business to manage more than $100 billion. In October, the company completed a $1.5 billion rights offering, with some of the money tagged for mergers and acquisitions in banking and insurance.
Sohu.com reported on Friday that Guo is helping with the investigation of Ai. Fosun spokesman Chen Bo said in a text message that he had no information to disclose.
Caixin magazine reported on Thursday, citing people it didn’t identify, that Guo’s companies had lost contact with him.
His name appeared at the end of a Friday filing by the listed firm Fosum International. A day earlier, the notice of its trading suspension had listed Vice Chairman Liang Xinjun’s name rather than Guo’s.