Gome Electrical Appliances Holdings Ltd chairman Huang Guangyu has been detained over further claims of allegedly bribing senior government officials before the firm's listing on the Hong Kong Stock Exchange, Chinese media reported yesterday.
Huang Guangyu [file photo]
The bribery allegations against Huang, who was listed as the richest mainlander this year by Hurun Report, follow accusations of market manipulation.
The Guangdong native and Zhou Yafei, the chief financial officer of Gome, were reportedly restricted from leaving the country by Beijing police at the beginning of October. Police detained the pair on Thursday, the 21st Century Business Herald reported.
The appliance and real estate tycoon is alleged to have been involved in bribery cases involving four senior officials of the Ministry of Commerce, including Guo Jingyi, former official of the ministry in charge of the registration of foreign-invested enterprise.
Guo was taken into custody by police last month.
The briberies allegedly took place during Gome's initial public offering application for the Hong Kong market made to the ministry between 2004 and 2006, the newspaper reported.
Gome, the country's biggest home appliance retailer, listed on the Hong Kong market as a "red chip" in June 2006. However, the listing, which took Gome six years to realize, raised suspicions given market regulations.
Red chips are Hong Kong-listed companies registered overseas. They have advantages of a simpler listing process and more freedom in capital operation such as mergers and acquisitions.
Whether Gome, a Beijing-based firm, was categorized as a red chip, was "entirely dependent" on the Ministry of Commerce, the paper said.
An insider from the Eagle Property Group, a unit of China Eagle Group controlled by Huang, told the newspaper Huang tried all means to carry out "public relations" with ministry officials.
The Securities Daily also said yesterday that Huang was detained for market manipulations involving other listed companies, including Shandong Jintai Group Co, Beijing Centergate Tech (Holding) Co and Sanlian Commercial Co.
(Shanghai Daily November 26, 2008)