SHANGHAI, March 2 (Reuters) - Trade in bonds issued by CEFC Shanghai International Group has been suspended indefinitely following a fierce sell-off sparked by news reports the chairman of CEFC China Energy was being investigated.
Trade in five bonds issued by CEFC Shanghai International Group with a total value of 14 billion yuan was suspended from March 1, the company said in a statement posted on Thursday evening on the Shanghai Stock Exchange's website. It did not say when trade might resume.
The price of the company's 3 billion yuan 4.98 percent 2020 bond fell 33 percent on Thursday morning after media reported that CEFC China Energy Chairman Ye Jianming was being investigated, prompting the Shanghai Stock Exchange to suspend trading in CEFC Shanghai International bonds for most of the day.
"To protect against unusual fluctuations in the price of outstanding bonds, and in accordance with relevant regulations of the Shanghai Stock Exchange, (trading of) these bonds will be suspended from Mar. 1," the statement said.
"In a situation where the abovementioned serious matter significantly affects bondholders' interests, the company may convene a bondholders meeting," the statement added, referring to media reports regarding CEFC China Energy's chairman.
Ye, chairman of a private firm that has agreed to buy a nearly $9.1 billion stake in Russian oil major Rosneft, has been investigated for suspected economic crimes, a person with direct knowledge of the matter told Reuters on Thursday.
CEFC China Energy said in a statement on its website late on Thursday that it was "operating normally". (Reporting by Andrew Galbraith Editing by Eric Meijer)