Shares of Noah Holdings Plunge 20% After Ching Lo's Arrest
The stock in Noah Holdings Ltd. (NYSE: NOAH) closed down more than 20 percent Monday, at $35.60 per American depositary share, after the company said its subsidiary managed funds related to an enterprise the shareholder in which has been detained.
The Shanghai-based wealth and asset management firm said its entity, Shanghai Gopher Asset Management Co. Ltd., managed credit funds that provided supply chain financing involving a third party, Camsing International Holding Ltd. The controlling shareholder of Camsing, Ching Lo, was taken into custody for alleged fraud.
Noah said the funds amounted to 3.4 billion yuan, or $500 million.
Lo is the chairwoman and CEO of Camsing International (HKEX: 2662) and chairs Boxin Investing & Holdings, listed in Shenzhen, as well as Singapore-listed Camsing Healthcare. She was arrested by the Shanghai Public Security Bureau's Yangpu district branch on June 20, as reported by Yicai Global.
Camsing owns POW! Entertainment Inc., an American media production company formed by Gill Champion, Arthur Lieberman and former Marvel Comics editor Stan Lee.
"As the fund manager of these funds, Shanghai Gopher Asset Management has initiated various legal actions and is committed to taking the best course of action to fulfill its obligations and to protect the interests of the investors of these funds," Noah said in its statement today.
In another official statement, the company said it expects that the related private equity funds will not be allocated at the expiration of the investment period while the investigation is underway.