The Financial Gang of 4

A battle between a shareholder and Founder Securities has resulted in police investigations and the media dubbing 4 company leaders "the new financial gang of 4."

The picture was much different less than a year ago: Stage set for first merger of securities companies

The planned merger and acquisition of one securities company by another, the first such case in China, was unveiled on Friday, Beijing-based National Business Daily reported.

Founder Securities Co Ltd plans to purchase China Minzu Securities Co Ltd for 13.2 billion yuan ($2.18 billion).

The purchaser will buy 100 percent of the equities of China Minzu Securities by private placement.

This means that the shareholders of China Minzu Securities will buy the new shares of Founder Securities at a certain ratio with their shares of China Minzu Securities.

China Minzu Securities will become a wholly owned subsidiary of Founder Securities after the merger.

Now:

Court orders 3b yuan in Founder Securities assets to be frozen

Beijing Zenith, a property developer, said in its Sina Weibo post that it was seeking compensation of three billion yuan in the arbitration, more than the 2.9 billion yuan Founder Securities had posted as revenue for 2013.

"Founder Group's chairman Wei Xin and chief executive Li You have been manipulating the group's companies for years … and embezzled tens of billions of yuan," the post said. "This has not only hurt shareholders' interests in its subsidiaries such as Founder Securities but also led to the loss of state-owned assets."

......The group is 70 per cent held by Peking University. The row is estimated to have cost its six listed companies at least 5.7 billion yuan in market capitalisation, with PKU Healthcare stocks down 30 per cent and Founder Technology down 10 per cent in the past two months. The group's Hong Kong-listed unit, PKU Resources, has also lost 30 per cent.

Beijing Zenith proposes three candidates to join board of Founder Securities

Beijing Zenith Holdings has proposed three candidates to join the board of Founder Securities, the latter announced on the Shanghai Stock Exchange website on Monday.

Founder will hold an extraordinary general meeting in Beijing on January 21 to decide on the selection of Zenith’s three candidates, namely Yin Mingzhu, Huang Weiping and Chen Guoxin, as independent directors of Founder, the Shanghai-listed company added.

A court has frozen three billion yuan (HK$3.7 billion) of assets of Founder Securities following complaints by its second biggest shareholder, Zenith, South China Morning Post reported last Saturday.

Zenith, a mainland property developer, said in its Sina Weibo post that it was seeking compensation of three billion yuan from Founder in the legal dispute. The two companies had only just joined hands last August, when Zenith’s majority-owned Minzu Securities merged with Founder Securities in a 13-billion-yuan deal.

iFeng: 媒体：中国金融市场新“四人帮”被围剿 (The New Financial Gang of 4)