Minxing Pharma's Boss Is Arrested Amid Probe Into USD320 Million Default
Liao Shumin
DATE:  Jul 12 2019
/ SOURCE:  yicai
Minxing Pharma's Boss Is Arrested Amid Probe Into USD320 Million Default Minxing Pharma's Boss Is Arrested Amid Probe Into USD320 Million Default

(Yicai Global) July 12 -- Minxing Pharmaceutical's controller Xia Xuewen has been arrested, according to Central China Securities, amid an investigation into CNY2.2 billion (USD320.5 million) of uncollectable accounts receivable at the drugmaker.

The headline figure includes CNY240 million (USD35.0 million) of asset management products issued by Central China Securities that cannot be redeemed, the Beijing-based brokerage said in a filing yesterday. After learning that the head of the drugmaker had gone missing, the brokerage reported the case to police in Henan province leading to Xia's arrest.

At least nine financial institutions including Central China Securities and Guolian Trust are involved in the matter, the 21st Century Business Herald reported, citing data from the Credit Reference Center of the People's Bank of China.

The Shanghai-listed shares of Central China Securities [SHA:601375] slumped 9.8 percent today to close at CNY5.22 (76 US cents) each, adding to a 4.7 percent decline yesterday. The stock price of its subsidiary Central China International Securities [HKG:1375] fell 5 percent to HKD1.68 (21 US cents) after nudging up 0.9 percent yesterday.

Guolian Trust has applied for the Fujian province-based drug company's bank accounts to be frozen and its property assets, worth CNY360 million (USD52.4 million), to be seized, according to a civil arbitration issued by the Jiangsu Wuxi Intermediate People's Court on May 13.

Guolian Trust has also provided details of other assets that should be appropriated, which include debts from five Fujian public hospitals including the Fujian Medical University Union Hospital.

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Keywords:   Minxing Pharmaceutical,Central China Securities Co.