Economy

Wanda denies its chairman is facing government restrictions

Wanda denies its chairman is facing government restrictions”

Shares in Chinese conglomerate Wanda's hotel chain plunged almost 10 percent in Hong Kong on Monday despite the firm dismissing as false reports that chairman Wang Jianlin had been barred from leaving the country and detained for hours.

Obscure US website Bowen Press, a Chinese-language site, said on Sunday that Wang and his family were stopped at Tianjin airport last Friday as they sought to fly to London.

Wanda Group released a statement Monday saying that in recent weeks "certain individuals with ulterior motives have... created and spread various vicious rumors" about supposed restrictions placed on Wang.

"Wanda Group strongly reiterates that all of these rumours are utterly baseless and have ulterior motives behind them", it added.

Despite the juggernaut's denial, shares of its Dalian Wanda Hotel Development subsidiary fell as much as 11 percent, before ending the day down 8 percent.

Wanda, which has spent billions buying entertainment and sports companies in recent years, has become a target in China's clampdown on capital outflows, and sources say Chinese banks have been told to stop providing funding for several of its overseas acquisitions in order to curb its appetite for offshore deals.

But the firm's shares dipped again in the afternoon, closing 8.09 percent lower at HK$1.59 (20 U.S. cents) as Wanda's denial apparently failed to completely allay investor concerns about a government crackdown on the conglomerate.

Also Read: What's Going on With China's Wanda Group?

The stock and bond crash was Wanda's second in two months, after suffering a similar fate in late June after a surprise series of regulatory checks were made on the company's borrowings, ultimately leading to a huge offload in its real estate assets to finance the conglomerate's loans.

That buying spree cooled previous year after regulators tightened controls on outbound investment.



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