Chinese oil baron hit by investigation
Shares of two firms linked to Chinese conglomerate CEFC China Energy tumbled Thursday after a report that its high-flying chairman was under investigation.
Ye Jianming -- dubbed China's "newest oil baron" by Forbes magazine in 2016 -- quickly built CEFC China Energy into a global energy powerhouse, expanding into Eastern Europe, Africa and the Gulf States, and agreeing to buy 14 percent of Russian oil giant Rosneft last year.
But Chinese financial news magazine Caixin, citing anonymous sources, reported that Ye has been put under investigation over links to a former Communist Party chief accused of graft.
The CEFC China Energy conglomerate itself is not publicly listed. But following the report, shares in Shenzhen-listed subsidiary CEFC Anhui International Holding fell by as much as 9.85 percent before closing down 4.45 percent, while affiliate CEFC Hong Kong Financial Investment Company dropped by almost 23 percent on Hong Kong's Hang Seng.
Both companies distanced themselves from Ye in separate stock filings.
"Ye Jianming does not hold any position at (CEFC Anhui), there is no direct relationship with our company, and he is not the company's actual controller," the Shenzhen-listed unit of CEFC China Energy said in a stock filing prompted by the Caixin report.
The Hong Kong company said its directors "noted there are press reports today about Mr. Ye Jianming" but stressed that he did not hold any directorship and is not involved in the management of the its operations.
The Caixin report did not specify the nature of the investigation into the oil tycoon though it noted "Chinese authorities have requested Ye's assistance in a graft investigation" of a former provincial Communist Party chief who had been detained on corruption charges.
The party chief had helped CEFC raise money, Caixin reported.
Beijing has sought to rein in conglomerates whose splashy overseas investments have taken billions out of the country. Last week, authorities took control of Anbang Insurance Group and said its chairman faced prosecution for "economic crimes".
CEFC's rapid expansion in China's state-dominated oil universe and emergence as a major player in world oil markets has raised questions about its backing inside China.
The company has played up its role in Chinese President Xi Jinping's ambitious One Belt One Road initiative.
CEFC China Energy did not respond to an AFP request for comment.
Last year, US authorities took the company to task over its business dealings in Africa.
US authorities arrested Hong Kong's former home affairs secretary and the ex-foreign minister of Senegal for leading a multimillion dollar bribery scheme in Africa on behalf of a top Chinese energy company.
CEFC was not identified in the announcement or the complaint filed in New York federal district court, but details in the complaint pointed to CEFC China Energy.