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China tycoon's company in trouble

By Chris Hogg
BBC News, Shanghai

An investor looks at trading board in a private Shanghai company Sep 2008.
Trade in leading company, Gome, is suspended.

Trade in shares in Gome, a company run by one of mainland China's richest tycoons, has been suspended.

It follows reports that Huang Guangyu, an entrepreneur said to have a net worth of around $2.7bn (£1.8bn), was detained last week.

China's state media says an investigation is under way into alleged stock market manipulation involving a company controlled by his brother.

Gome has over 1,200 stores in China and employs more than 200,000 people.

The trade in shares in Mr Huang's Hong Kong-listed company, a chain of stores that sells electrical appliances, has been suspended ahead of what the firm calls a "price-sensitive" announcement that will clarify the situation regarding the chairman.

Newspapers here are reporting that Mr Huang is under investigation for alleged stock market manipulation.

Family ties

Mr Huang has not made any comment in the official media and his whereabouts are unknown.

The reports suggest he is being questioned about unusual movements in the share price and other financial irregularities of a company that produces medicine.

The company, listed in Shanghai, is controlled by his brother.

Mr Huang grew up in a poor family in the southern Chinese province of Guangdong.

He and his brother opened their first store 21 years ago.

His firm is now said to be worth more than $6bn, and different surveys suggest he is either the richest or the second richest man in mainland China.



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