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Missing China tycoon's company says 'operating as normal,' shares slump
February 3, 2017 / 2:45 AM / 8 months ago

Missing China tycoon's company says 'operating as normal,' shares slump

A statement of Chinese billionaire Xiao Jianhua is printed on the front page of local newspaper Ming Pao in Hong Kong, China February 1, 2017. REUTERS/Bobby Yip

SHANGHAI/BEIJING (Reuters) - Listed firms controlled by Tomorrow Holdings, the company run by missing Chinese-born businessman Xiao Jianhua, slumped on Friday, despite the parent group saying its businesses were all operating normally.

Mystery swirled around billionaire Xiao’s whereabouts earlier this week, with some reports saying he had been abducted from Hong Kong and taken to mainland China.

A statement purportedly from Xiao posted in a Hong Kong newspaper said he was seeking medical treatment “outside the country”.

Hong Kong police told Reuters Xiao had entered mainland China through a border checkpoint on Jan. 27 and that they were seeking more information from Chinese authorities.

Tomorrow Holdings, a financial group headquartered in Beijing, said in a statement on its official microblog late on Thursday its own operations were unaffected.

“The production activities of Tomorrow Holdings and its subsidiaries are operating as normal,” the company said in a statement on messaging service WeChat. “We thank everyone for their interest and deep love for Mr Xiao Jianhua and our firm.”

However, shares in firms directly or indirectly controlled by Tomorrow Group slumped on Friday, with Baotou Huazi Industry Co Ltd (600191.SS) and Xishui Strong Year Co Ltd Inner Mongolia (600291.SS) both falling by the maximum 10 percent.

In a notice, dated Feb. 3 and posted on the door of its listed Beijing office, the firm said it had not been told to cooperate in any legal investigations, adding it could use legal means to go after media outlets for spreading rumors.

The office appeared to be unused and a receptionist at the building told a Reuters reporter that the company had moved. He did not give further details.

Chinese Foreign Ministry spokesman Lu Kang declined to comment on the matter at a daily briefing.

A spokesman for Canadian Foreign Affairs Minister Chrystia Freeland said consular officials were “actively reaching out” to local authorities about Xiao, who is a Canadian citizen. But he declined to comment on whether Xiao holds a Canadian passport.

Despite conflicting accounts of Xiao’s whereabouts, the case has echoes of the abduction in Hong Kong last year of five staff who worked for a bookseller that published gossip on China’s leaders.

Three of those staff were detained while in China, but two with foreign passports were taken there against their will from Thailand and Hong Kong.

Xiao was ranked 32nd on the 2016 Hurun China rich list, China’s equivalent of the Forbes list, with an estimated net worth of $5.97 billion.

Reporting by Adam Jourdan in SHANGHAI and Christian Shepherd and Ben Blanchard in BEIJING; additional reporting by Leah Schnurr in Ottawa; editing by Paul Tait, G Crosse

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