A divorce case involving Zhao C Ying, a dedicated follower of Warren Buffett, could cost him the hard-earned title "Buffett Zhao." (File Photo/CFP)
Wan Rong Investment Group chairman Zhao C Ying has been stuck in a divorce case involving 2 billion yuan (US$314 million), with the case affecting his Wohua Pharmaceutical, the share price of which has plummeted since the dissemination of the news of his divorce. Zhao faces the possibility of losing half of his property, according to the China Economic Weekly.
Zhao — also known as Chinese Buffett or Buffett Zhao — is committed to applying American investor Warren Buffett's investment philosophy in China, and is a fanatical follower of Buffett's. Since 2000, he has helped a number of large firms to go public through his investment firm, Wan Rong. Zhao has won a good reputation among Chinese investors and accumulated a considerable fortune.
In April 2010, Lu Juan, Zhao's wife, filed for divorce, saying that by altering her signature Zhao had transferred assets under both of their names to himself. Lu claimed that by holding stakes in several listed companies, Zhao's assets come to more than 2 billion yuan. After the divorce filing, Zhao refused to appear in court numeral times, rendering the court unable to move judicial proceedings forward.
During this period, Lu said that her husband "on the one hand is always hiding in order to shy away from appearing in court, but on the other hand uses the time to alter my signatures to transfer properties under our names." Lu added that Zhao "wanted to kill (her) by calling gangsters and hitmen, and will ask his friends serving in the Public Safety Bureau to arrest (her)."
At the end of November 2010, in order to force Zhao to show up, Lu went to the Wan Rong offices and tried steal a safe deposit box to take to court, but was intercepted by staff and police. The case's judge later withdrew Lu's filing, meaning she had to wait another six months before filing for divorce again.
In August 2011, Lu filed for divorce a second time at Chaoyang District People's Court in Beijing, but Zhao claimed to be abroad and that he hadn't received the court summons.
Lu was held in custody on Aug. 25 for the suspected theft of a Wan Rong safety deposit box, and was released on bail on Sept. 28. After that, she actively communicated with the public through posts on microblogs and websites, with each of her messages drawing considerable attention and damaging the share price of Wohua Pharmaceutical. Meanwhile, Zhao remained invisible. Lu said, however, that since mid-May Zhao had hired people to publish news on the internet, newspapers and magazines that the two had reconciled their differences, in an effort to bring share prices back.
On Nov. 21, the divorce case opened at the Chaoyang district court, but Zhao again did not show up. The court session adjourned at noon.
Shareholders are furious about Zhao's divorce case, which has had a serious effect on Wohua's shares. Since April 2010, the price of its shares has dropped from 24.98 yuan (US$3.92) to 12 yuan (US$1.88).
Wan Rong Investment Group 中证万融投资集团
Zhao C Ying 赵丙贤
Lu Juan 陆娟
Wohua Pharmaceutical 沃华医药