news

한어Русский языкEnglishFrançaisIndonesianSanskrit日本語DeutschPortuguêsΕλληνικάespañolItalianoSuomalainenLatina

[Introduction] Behind Saudi Aramco's investment in Rongsheng Petrochemical, many insider trading cases surfaced. The private equity president's 8 accounts were leveraged for trading, and the brother of the secretary of the board of directors also participated in insider trading. The regulator imposed heavy penalties on them.

China Fund News reporter Lin Xue

Last year, Saudi Aramco's investment in Rongsheng Petrochemical attracted much attention in the capital market. Rongsheng Petrochemical's share price rose strongly, but some people knew the inside information in advance and used it to trade stocks for profit.

Recently, the China Securities Regulatory Commission disclosedFour administrative penalty decisions, involving the then Four people including the president of private equity, the deputy general manager of Rongsheng Energy, the deputy director of the president's office of Rongsheng Holdings, and the manager of the fund management department of the financial management center of Rongsheng Holdings, their illegal insider trading of Rongsheng Petrochemical stocks was exposed. In the end, all four were fined and had their illegal gains confiscated by regulators.。

The whole story of Saudi Aramco's investment in Rongsheng Petrochemical

The administrative penalty decision disclosed by the CSRC this time tells the story of Saudi Aramco's investment in Rongsheng Petrochemical.

In 2022, Saudi Aramco began toZhejiang Rongsheng Holding Group Co., Ltd. (hereinafter referred to as Rongsheng Holding)Negotiating the acquisition of Rongsheng Petrochemical shares.

On June 2, 2022, Saudi Aramco Vice President Khamouni andLi Rongrong, Chairman of Rongsheng HoldingsA video conference was held. At the meeting, Saudi Aramco expressed its initial intention to acquire some shares of Rongsheng Petrochemical and proposed that the two sides sign a memorandum or framework document on this matter. On August 25, Ka Mouni and Li Mourong signed a "Memorandum of Understanding" via video. Both parties agreed to have reasonable discussions on the sale and purchase of shares and crude oil purchases。

January 4, 2023Xiang Moujiong, Vice Chairman of Rongsheng HoldingsA WeChat group called "Saudi Aramco Equity Agreement" was formed, with group members including Lu Moujie, Director of the Legal Department of Rongsheng Holdings, Tao Mouqiao, Financial Director of Rongsheng Holdings, and Quan Mouying, Secretary of the Board of Directors of Rongsheng Petrochemical。

On January 24 and February 14, 2023, Xiang Moujiong went to Singapore twice to hold talks with Saudi Aramco and determined the direction and terms of the agreement for a package of strategic cooperation in crude oil, chemicals and share trading. On February 28, Rongsheng Holdings and Saudi Aramco communicated on the payment process through an online meeting.Lu Moujie, Tao Mouqiao, and Zhou Wenli, manager of the fund management department of Rongsheng Holdings' financial management centerwait.

On March 23, 2023, Rongsheng Holdings held a board of directors and shareholders meeting and approved a package agreement on the transaction between Rongsheng Holdings and Saudi Aramco. On March 24, Ka Mouni proposed to Li Mourong and Xiang Moujiong to hold a strategic investment signing ceremony in Beijing on March 27.

At 16:54 on March 27, 2023, Rongsheng Petrochemical issued the "Notice on the Introducing of Strategic Investors and the Transfer of Part of the Company's Shares by the Controlling Shareholder". According to the announcement, Rongsheng Holdings transferred its 1.013 billion shares of Rongsheng Petrochemical to Aramco Overseas Company BV (Saudi Aramco is its sole shareholder) at a price of RMB 24.3 per share.

On March 27, 2023, Rongsheng Petrochemical surged 7.76%. The stock hit the daily limit on March 28 and 29. On April 7, it once rose to 15.66 yuan per share, but the stock price has since adjusted significantly.

The CSRC stated thatThis event is a major event as defined in Item 8 of Paragraph 2 of Article 80 of the Securities Law. According to Article 52 of the Securities Law, it is inside information before it is made public.. The insider information was formed no later than August 25, 2022, when Ka Mou Ni and Li Mou Rong signed the Memorandum of Understanding via video, and was made public on March 27, 2023.

Private equity president leverages 8 accounts

The brother of the secretary also participated in insider trading

So, how did the four people who were punished this time know this inside information? The administrative penalty decision also disclosed this.

Wang Xianpeng was the CEO of Hangzhou Jiusheng Private Equity Fund Management Co., Ltd. at the time. He knew Rongsheng Petrochemical's board secretary Quan Mouying., and in the WeChat group "Saudi Aramco Equity Agreement" established by Xiang Moujiong on January 4, 2023, Quan Mouying was one of the group members. During the sensitive period of insider information, Wang Xianpeng and Quan Mouying had many phone calls.

From March 24 to March 30, 2023, Wang Xianpeng used his ordinary account and credit account, as well as the stock accounts of his wife, father, sister, brother-in-law, mother-in-law, cousin and other relatives, a total of 8 securities accounts, to trade Rongsheng Petrochemical and added leverage.

Wang Xianpeng used these account groups to buy a total of 604,900 shares of Rongsheng Petrochemical during the sensitive period of insider information, with a purchase amount of 7.2653 million yuan, and sold 604,900 shares for a selling amount of 8.8983 million yuan. After calculation, he made a profit of 1.6208 million yuan.

The CSRC stated that Wang Xianpeng's behavior violated Article 50 and Article 53, paragraph 1 of the Securities Law, and constituted insider trading as described in Article 191, paragraph 1 of the Securities Law.The CSRC decided to confiscate Wang Xianpeng’s illegal gains of RMB 1.6208 million and impose a fine of RMB 4.8624 million。

andQuan Weijun, then deputy general manager of Rongsheng Energy Co., Ltd., is the brother of Quan Mouying, secretary of the board of directors of Rongsheng PetrochemicalThe two lived in the same residential complex, met and interacted with each other frequently, had a close relationship, and contacted each other frequently during the sensitive period of insider information.

According to the information disclosed in the administrative penalty decision,Quan Weijun borrowed the ordinary stock accounts and credit accounts of his mother-in-law and others to leverage Rongsheng Petrochemical in March 2023.During the sensitive period of insider information, he bought 458,000 shares of Rongsheng Petrochemical for 5.5947 million yuan, and sold 458,000 shares for 6.9191 million yuan, with a calculated profit of 1.3157 million yuan.

The CSRC stated that Quan Weijun's actions violated the provisions of Article 50 and Article 53, paragraph 1 of the Securities Law, and constituted insider trading as described in Article 191, paragraph 1 of the Securities Law.The CSRC decided to confiscate Quan Weijun’s illegal gains of RMB 1.3157 million and impose a fine of RMB 3.9471 million。

Employees of the controlling shareholder engaged in insider trading

All of them had their illegal gains confiscated and were fined 1.2 million yuan

Zhou Wenli was the manager of the fund management department of Rongsheng Holdings' financial management center at the time. On February 28, 2023, Rongsheng Holdings and Saudi Aramco communicated the payment process through an online meeting, and Zhou Wenli attended the meeting. The China Securities Regulatory Commission stated that according to Article 51, Item 4 of the Securities Law, Zhou Wenli is a statutory insider and knew the inside information no later than February 28, 2023.

Zhou Wenli used her and her husband’s stock accounts to leverage Rongsheng PetrochemicalFrom March 23 to 27, 2023, it bought 107,100 shares of Rongsheng Petrochemical for RMB 1,268,600. After the announcement, it sold 107,100 shares for RMB 1,580,800, making a profit of RMB 310,100.

The CSRC stated that Zhou Wenli's actions violated the provisions of Article 50 and Article 53, paragraph 1 of the Securities Law, and constituted insider trading as described in Article 191, paragraph 1 of the Securities Law.The CSRC decided to confiscate Zhou Wenli’s illegal gains of 310,100 yuan and impose a fine of 1.2 million yuan.

Wu Miaoqin was the deputy director of Rongsheng Holdings' President's Office at the time.. On December 2, 2022, Li Rong sent Wu Miaoqin the "1201 Aramco Core Terms" via WeChat and asked Wu Miaoqin to print it. The content of the "1201 Aramco Core Terms" is the progress of the negotiations between Rongsheng Holdings and Saudi Aramco, involving the quantity, price, and related agreements of equity transfer. The China Securities Regulatory Commission stated that according to the provisions of Article 51, Item 4 of the Securities Law, Wu Miaoqin is a statutory insider and knew the insider information no later than December 2, 2022.

Wu Miaoqin used her own securities account to trade, buying 150,000 shares of Rongsheng Petrochemical on February 8, 2023, and 1,600 shares on March 6, 2023, with a total purchase amount of 1.9329 million yuan. On February 13, 2023, she sold 1,600 shares for 20,700 yuan. After the announcement, this account did not trade Rongsheng Petrochemical. As of September 7, 2023, the market value of the remaining shares of Rongsheng Petrochemical traded by this account was 2.2057 million yuan, with a book profit of 315,300 yuan.

The CSRC stated that Wu Miaoqin's behavior violated the provisions of Article 50 and Article 53, paragraph 1 of the Securities Law, and constituted insider trading as described in Article 191, paragraph 1 of the Securities Law. The CSRC decided thatWu Miaoqin was ordered to dispose of the 150,000 shares of Rongsheng Petrochemical that she illegally held in accordance with the law, confiscate the illegal gains of 315,300 yuan, and impose a fine of 1.2 million yuan.

Editor: Captain

Review: Xu Wen

Copyright Notice

"China Fund News" enjoys the copyright to the original content published on this platform. Reproduction without authorization is prohibited, otherwise legal liability will be pursued.

Contact person for authorized reprint cooperation: Mr. Yu (Tel: 0755-82468670)