(Bloomberg) -- The latest clue pointing to the fate of elusive Chinese oil baron Ye Jianming is coming from an unlikely source outside the Asian nation’s shores: the Czech Republic.
The office of the Czech president said in a statement that Ye will step down from the management of CEFC China Energy Co. and will no longer be a shareholder in the company he founded, which owns everything from a brewery to a soccer team in the European nation. It’s the first official confirmation of what’s happened to Ye since news broke that he’s under investigation by Chinese authorities.
It’s the latest twist in the story of Ye and CEFC, a previously obscure firm that was thrust into the limelight six months ago when it agreed to buy a $9 billion stake in Russian state energy giant Rosneft PJSC following a series of deals elsewhere. In recent weeks, the company has been caught up in a swirl of turmoil and speculation, including record declines in its bonds and reports that it’s been taken over by an arm of the Shanghai government.
Advisers to the Czech head of state, Milos Zeman, were informed of Ye’s departure by current CEFC President Chan Chauto while visiting China last week, according to the statement. A Shanghai-based spokesman for the company declined to comment Tuesday.
The Czech Republic was a target for CEFC investments as it grew over the last few years, purchasing stakes in a wide range of firms including J&T Finance Group, an airline, a soccer team, a brewery, a heavy machinery maker and a media company. As well, Zeman had appointed Ye as an adviser on Czech-Chinese business relations.
Last year, CEFC said in a statement that the Czech Republic is an “extremely important industrial corridor in Europe,” and that it set up its second headquarters in the country as “a bridgehead for investment” in the region.
On Monday, the CTK news service reported that CEFC is withdrawing its request to increase its stake in Prague-based J&T Finance. China’s state-owned Citic Group is in talks to buy a stake of as much as 49 percent in CEFC’s European unit, Reuters reported on Tuesday.
Ye and CEFC have come under scrutiny amid Chinese President Xi Jinping’s crackdown on debt-fueled expansions, which has targeted the country’s rising tycoons and their recently acquisitive companies, including the seizure last month of Anbang Insurance Group Co.
CEFC’s agreement to buy the stake in Rosneft last year, the biggest overseas Chinese oil acquisition since 2012, stoked questions of the company’s origins, its funding and its possible connections to China’s ruling Communist Party.
‘Taking Measures’
CEFC said last week that it’s “actively taking measures” to maintain operating stability as it faces a record amount of bonds coming due this year. The company’s units must repay at least 11.8 billion yuan ($1.9 billion) of notes during the rest of 2018, according to data compiled by Bloomberg.
After starting in 2002 as a small trader, CEFC has since rapidly expanded through the purchase of terminals, refineries and oil fields, as well as financial units. In a statement at the time of the Rosneft deal, CEFC described itself as China’s largest private oil and gas company, with 50,000 employees and revenue of more than $40 billion.
©2018 Bloomberg L.P.
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