China Renaissance Founder Bao Fan Cooperates with Government Probe
Missing Chinese investment banker Bao Fan is cooperating with a government investigation, his firm China Renaissance attested to in a filing on February 26. The company’s Hong Kong-listed shares have plunged 29% since the firm revealed on February 16 that Bao had been reachable.
Bao Fan is China Renaissance’s controlling shareholder, chief executive officer, and founder, among other roles. Over the past 14 years, under Bao’s leadership, the investment institution has successfully completed the financing and M&A transactions of many Chinese internet brands, including investing in bicycle-sharing brands Mobike and TikTok rival Kuaishou, facilitating the partnership between JD.com and Tencent, and completing the merger of Didi and Kuaidi.
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China Renaissance has four major business domains, namely investment management, investment banking, wealth management, and China Renaissance Securities, among which investment banking and wealth management are its core. As of June 2022, the total assets of China Renaissance were 14.453 billion yuan ($2.08 billion).
In the first half of 2022, China Renaissance achieved a revenue of 512 million yuan ($73 million), down 42.39% year-on-year, while the net profit was -154 million yuan ($-22 million), down over 110% year-on-year. However, since 2019, its investment management business has maintained a stable annual income of over 400 million yuan ($57 million).
Earlier this month, Chinese financial news outlet Caixin pointed out that Bao’s disappearance followed the investigation of another China Renaissance executive, Cong Lin. Cong was also the chairman of the firm’s subsidiary Huajing Securities. In September last year, Huajing was accused of violating securities law requirements regarding corporate governance.
Bao’s last public appearance was in early December 2022 at the Future Science Prize award ceremony. His last WeChat post on January 9 this year shows him congratulating Fenbi, a Chinese education platform backed by China Renaissance, for the debut of HKEx.
After Bao lost contact, China Renaissance appointed two executives to manage operations. One of them is Kevin Xie who joined the company in 2005. Xie is the co-founder, managing director, and head of the healthcare advisory team overseeing the financial advisory business for the healthcare sector. The medical industry team that he leads is the largest team in the company.
The second executive is Wang Lixing. Wang serves as managing director and head of investment banking division at China Renaissance. Since joining the company in 2007, Wang has held various positions, including overseeing its M&A and private placement businesses.
According to a report from Jiemian News, Xie and Wang have always been China Renaissance’s important figures next to Bao. Bao had long been committed to mentoring and developing young professionals. In 2018, China Renaissance made great efforts to train a group of 16 select young executives among the post-80s generation who displayed the highest potential. Bao’s requirements for the next generation of leaders of China Renaissance are excellent capabilities and morality.