A CEFC logo is seen at CEFC China Energy’s Shanghai headquarter in Shanghai, China September 14, 2016. Picture taken September 14, 2016. REUTERS/ Aizhu Chen
March 1, 2018
By Benjamin Kang Lim
BEIJING (Reuters) – The chairman of China’s CEFC China Energy, the private firm that has agreed to buy a nearly $10 billion stake in Russian oil major Rosneft, has been investigated for suspected economic crimes, a person with direct knowledge of the matter said.
Ye Jianming was taken in for questioning this year, the person said without saying which authorities were involved or whether the probe was continuing. The person declined to be identified because of the sensitivity of the matter.
CEFC China Energy, which is focused on energy and other investments abroad, has emerged from a role as niche fuel trader to become a rapidly growing oil and finance conglomerate, with assets across the world and an ambition to become one of China’s energy giants. It agreed in September to buy a 14.16 percent stake in Rosneft for $9.1 billion.
CEFC China Energy did not respond to requests for comment on the probe into Ye, reported earlier on Thursday by Chinese magazine Caixin without citing sources.
The investigation casts further doubt on the timing of the completion of the Rosneft deal.
A senior source with direct knowledge of the transaction told Reuters earlier this week he expected the deal to close in the first half of this year, suggesting a delay from previous expectations.
Company executives had initially said the deal to close early this year.
News of the probe comes after the Chinese government last week took control of insurer Anbang Insurance Group Co Ltd and said its chairman was being prosecuted for economic crimes, underscoring Beijing’s willingness to curtail big-spending conglomerates as it cracks down on financial risk.
Shares in CEFC China Energy’s listed subsidiary CEFC Anhui International Holding <002018.SZ> slumped as much as 10 percent, the maximum allowed, on reports of the investigation.
The stock hit its lowest since Sept. 2014.
(Reporting by Benjamin Kang Lim Additional reporting by Aizhu Chen; Writing by Josephine Mason; Editing by Kenneth Maxwell and Lincoln Feast)