Flaming Shanghai billionaire art collector builds auction house

Liu Yiqian, the flamboyant billionaire from Shanghai who made headlines around the world for record bids in auctions organized by Christie’s and Sotheby’s, is about to create a larger family auction business.

Jiangsu Hongtu High Technology, a Chinese household appliance chain listed in Shanghai, on Saturday announced plans to buy 100% of Beijing Council International Auction Co. for $ 415.4 million by issuing new shares of the listed company to shareholders. existing Beijing Council. The Beijing Council is currently 32.8% owned by Chen Jia, Liu’s son-in-law, and 32.7% by Dong Guoqiang who co-founded the auction company with Liu’s Sunline Group in Beijing in September 2005. Sunline does not currently own any shares in Beijing Council.

The Beijing Council offers Chinese collectibles ranging from paintings to sculptures. Its net profit in 2016, 2017 and 2018 is expected to be $ 23 million, $ 30.8 million and $ 40 million, according to the announcement.

Jiangsu Hongtu High Technology also announced on Saturday that it would raise $ 230.8 million by issuing 46.5 million new shares to majority shareholder Yuan Yafei, who is also a billionaire, and Liu individually at 16.12 yuan per share. to support its electronics retail business and expand the Beijing Council auction. Business. Of the $ 230.8 million to be raised, some $ 115.4 million will be used to develop the auction business.

Jiangsu Hongtu’s shares have been suspended since December 25, 2015, which closed at 19.42 yuan. The electronics retailer’s profit in 2015 rose 15% to $ 65 million, with sales rising 7% to $ 2.9 billion.

Yuan currently owns 20.5% of Jiangsu Hongtu. If regulatory approval of the transaction is granted, the placement would reduce its ownership interest to 19%. Liu and his son-in-law Chen Jia would own 3.13% and 4.6% of Jiangsu Hongtu after the acquisition and the private placement.

Yuan, who runs Nanjing-based conglomerate Sanpower Group, is best known outside China for its takeover of UK retailer House of Fraser in 2014. House of Fraser is expected to open its first store in China this year.

Liu ranked No. 569 on Forbes’ billionaire list in 2016 with an estimated fortune of $ 3 billion. Yuan ranked No. 1,275 with a wealth of $ 1.4 billion.

–with Maggie Chen

–Follow on Twitter @rflannerychina

Norma D. Ross