(Yicai Global) March 31 -- A court in China's southwestern Guizhou province sentenced Gao Shouhong, former vice general manager of Kweichow Moutai, to ten years in prison for palming bribes, fined him CNY500,000 (USD70,500), and ordered him to forfeit CNY7.17 million, the amount of the bung he took, the trial court said yesterday on its account on Tencent Holding's popular WeChat messaging app.

The court in the world's most valuable distiller's home province found that Gao used his positions in the state-backed group to receive bribes and seek interests for others in project contracting, fund allocation, real estate cooperation, and material supply from 2009 to the second half of 2018.

The company, which is based in Zunyi in Guizhou, cannot produce Moutai elsewhere to lift output since Moutai's quality largely depends on the geographical and geological character of its source, and market demand has skyrocketed along with rising living standards. The actual retail price of Moutai is often far higher than the distiller's sticker price of CNY1,499 per bottle, and supply bottlenecks around China's major festivals make for fertile ground for its dealer's to exploit this spread and offer gratuities for preferential treatment.

Gao will not appeal the sentence, he told the tribunal.

Kweichow Moutai's share price [SHA: 600519] closed up 3.07 percent up at CNY1,104.90 (USD155.70) at lunch today, while the overall Shanghai Composite Index ended up only 0.42 percent.

Yuan Renguo, who served as Moutai's chairman for about 20 years, was expelled from the Communist Party of China and removed from public office in May for "serious violation of laws and regulations" after he exploited his post to seek profit for others, accepted a huge amount of assets and was also suspected of accepting backhanders.

Moutai became the most valuable share [SHA:600519] on China's A-share market of domestically traded firms when its stock price hit CNY1,001 (USD145) in June.

Distilled from a mash of sorghum, the liquor is named after the town of the same name near Zunyi, where distilling has a very long history. Today's spirit, which originated during the Qing dynasty, came into the international spotlight after winning a gold medal at the Panama-Pacific Exposition in San Francisco in 1915.

The fiery potation is served at China's feasts with foreign heads of state and other dignitaries. Zhou Enlai famously entertained Richard Nixon during the banquet for the latter's state visit to China in 1972 with the country's official baijiu tipple.
Editor: Ben Armour