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Sports Deal Gone Sour Sends Ripples Into a $3.3 Trillion Market in China

  • Merchants Bank issued WMP to funnel money to MP & Silva deal
  • Bank now negotiating with partner after MP & Silva went bust

Photographer: Pedro Pardo/AFP via Getty Images

The high-profile failure of a European sports-rights agency has sent ripples into an opaque Chinese market for investment products that’s come under increased regulatory scrutiny.

China Merchants Bank Co. in 2016 used proceeds from a 2.8 billion yuan ($414 million) wealth-management product to invest in London-based MP & Silva, the company that was dissolved by the U.K. High Court in October, as part of a Chinese consortium. As the investors tally their potential losses, the lender is now negotiating with one of the lead partners in the group, it said in an emailed response to questions.