Yangzijiang Shipbuilding Holdings saw its share price plummet 28% over the course of this morning, resulting in a query from the Singapore Stock Exchange and a halt in trading.
Singapore's Business Times linked the slump to a TradeWinds article revealing shipbuilding veteran Liu Jianguo was being probed for serious disciplinary violations by the Communist Party of China's powerful anti-graft body.
Liu's career has been closely connected with Yangzijiang and he is chairman of the management committee of the Jiangsu Yuanlin Charity Foundation, which was set up by the shipbuilder's founder Ren Yuanlin and is funded by dividends from the yard, it said.
The Chinese shipyard's share price opened at SGD 1.30 before a huge spike in trading volumes was seen shortly after 09:00am.
The share price continued to fall as the morning went on, bottoming out at S$0.93 at 11:10am.
"We have noted, and draw to your attention, unusual price movements in your shares today," the Singapore Stock Exchange said in its query, filed in Singapore at 11:15am today.
Executive chairman, Ren Yuanlin, filed the company's trading halt request just over 10 minutes later.
The stock exchange has asked the Chinese shipyard to disclose any information regarding its activities or those of its subsidiaries or associated companies that could have caused the price movements.
On Monday, the shipyard announced that its joint venture with Japan's Mitsui E&S Shipbuilding will begin operations this month.
Jiangsu Yangzi-Mitsui Shipbuilding has been incorporated in China with registered capital of $99.9m, the filing said.
The shipyard on Monday filed its financial results for the first half of 2019, which showed year-on-year improvement.
Net profit for the first six months was CNY 1.82m ($258,378), on the back of more revenue from shipbuilding.
Liu retired from his active political and party offices in 2011. His career until then included long service in a key shipbuilding region of Jiangsu province on the Yangtze River.
He started in his native Jiangyin, part of the larger Wuxi municipality on the south side of the river, in the 1990s. He later crossed the river to Jingjiang in Taizhou municipality on the north side, where he rose to serve as Jinjiang party secretary.
Before retirement, Liu also held a position in the standing committee of the Communist Party in Wuxi’s neighbour city, Changzhou.
The region is known for its string of large shipyards, including state-owned Chengxi Shipyard, privately controlled New Century Shipbuilding and subsidiary New Times Shipbuilding, Jingjiang Nanyang Shipbuilding and Yangzijiang Shipbuilding, China’s biggest privately owned shipbuilder.
As head of the government-sponsored Jiangyin Hi-Tech Industrial Development Zone and in other functions, Liu was a patron and frequent guest of honour of several regional shipyards. His career was especially closely connected with Yangzijiang, which has manufacturing bases on both sides of the river.
He shares his hometown of Jiangyin with Ren Yuanlin, the former welder who founded Yangzijiang. When Liu retired, Ren asked him to be chairman of the charitable foundation bearing his name.
Ren has been honoured as one of China’s leading philanthropists for his work with the Jiangsu Yuanlin Charity Foundation, to which he and Yangzijiang have made substantial contributions, including all the dividends from the billion shares Ren holds in the Singapore-listed company. The foundation’s beneficiaries include especially medical and educational causes.
