China Renaissance Shares Plunge as Trading Resumes, Founder Still Missing

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Bao Fan. Photo: VCG

Shares in China Renaissance Holdings Ltd., the boutique investment bank whose billionaire founder and former Chairman Bao Fan disappeared last year, closed down 13.9% in Hong Kong on Tuesday after plunging 66% the previous day when they resumed trading after a 17-month halt.

The suspension was lifted after the company finally published its delayed annual earnings reports for 2022 and 2023, and its results for the first half of 2024 on Thursday evening. The financial statements showed the Beijing-based financial services group lost 429.9 million yuan ($63.9 million) in 2022 and 471.9 million yuan in 2023, a performance the company attributed to challenges in the market environment, including dwindling private equity deals and slumps in domestic and overseas IPO markets.

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China Renaissance shares fell 13.9% after resuming trade post a 17-month suspension, during which the company delayed releasing financial results.
The Beijing-based firm reported significant losses in 2022 and 2023, with an improved performance in the first half of 2024.
Founder Bao Fan remains under investigation by Chinese authorities; exact details remain unclear, but it may relate to the recruitment of finance veteran Cong Lin.

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Who’s Who

China Renaissance Holdings Ltd.: China Renaissance Holdings Ltd. is a Beijing-based boutique investment bank, founded by Bao Fan in 2005, known for major mergers in China's tech sector. Its shares recently fell after resuming trading following a 17-month suspension. The company reported losses in 2022 and 2023 but showed an improved performance in early 2024. Bao, who vanished in February 2023, remains under investigation. His wife, Hui Yin Ching, is a newly appointed non-executive director, owning 48.7% through Bao.

Nio Inc.: Nio Inc. is one of the startups backed by Bao Fan, the founder of China Renaissance Holdings Ltd. It is a notable company among those he supported through his investment bank.

WuXi AppTec Co. Ltd.: WuXi AppTec Co. Ltd. is one of the startups backed by Bao Fan, the founder of China Renaissance Holdings Ltd. It is mentioned as part of Bao's history of supporting startups. The context provided doesn't offer additional details about the company itself.

Didi Chuxing: Didi Chuxing was formed by the merger of Didi and Kuaidi, a significant merger in China's tech sector facilitated by China Renaissance's founder Bao Fan. Didi Chuxing is a major ride-hailing service in China.

Meituan: Meituan is a tech company in China known for its role in the merger with Dianping, facilitated by China Renaissance's founder Bao Fan. The merged entity formed one of the largest O2O (online-to-offline) service providers in China, offering services like food delivery, hotel and travel booking, and other lifestyle services.

Ctrip: Ctrip is one of the companies involved in major mergers and acquisitions in China's tech sector, orchestrated by China Renaissance founder Bao Fan. It merged with Qunar, another travel service provider, in a notable deal.

Qunar: Qunar is mentioned in the article as part of one of the significant mergers and acquisitions in China's tech sector, specifically its merger with Ctrip. China Renaissance's founder, Bao Fan, played a role in this transaction.

Kuaishou Technology: Kuaishou Technology is a Chinese tech company whose blockbuster Hong Kong share sale in 2021 was sponsored by China Renaissance’s Hong Kong securities subsidiary. Kuaishou is a prominent player in China's burgeoning tech sector.

Industrial and Commercial Bank of China Ltd.: Industrial and Commercial Bank of China Ltd. (ICBC) is the country's largest bank by assets. The article mentions Cong Lin, a finance veteran and former executive from ICBC, who was invited to join China Renaissance by its founder Bao Fan. It suggests Bao's disappearance and subsequent investigation may be related to Cong Lin.

AOGB CPA Ltd.: According to the article, AOGB CPA Ltd. was hired by China Renaissance to assess issues related to Bao Fan. They reported finding no anomalies concerning "the recruitment and compensation of a previous senior employee" or "a loan agreement" speculated to be linked to Bao's investigation cooperation. However, AOGB cautioned that their conclusions were limited due to the restricted availability of records.

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What Happened When

February 2023：: Bao Fan disappeared and became unreachable. China Renaissance later said he was cooperating with an investigation by Chinese authorities.

April 2023：: China Renaissance's shares were suspended after it delayed releasing its 2022 annual financial results.

August 2023：: China Renaissance said that Bao was still cooperating with authorities in the investigation.

February 2024：: China Renaissance announced Bao's resignation from the positions of executive director, chairman, and CEO.

Thursday evening, September 5, 2024：: China Renaissance published its delayed annual earnings reports for 2022 and 2023, and its results for the first half of 2024.

Friday, September 6, 2024：: China Renaissance notified the Hong Kong Stock Exchange of the resumption of trading and stated they had no knowledge of the investigation’s subject, status, or reasons.

Sunday, September 8, 2024：: China Renaissance disclosed that its four executive directors pledged not to sell their holdings before March 7, 2025, but they could terminate the lock-up period early.

Tuesday, September 10, 2024：: Shares in China Renaissance Holdings Ltd. closed down 13.9% in Hong Kong after plunging 66% the previous day when trading resumed after a 17-month halt.

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