The biggest shareholder of Chinese gaming company Kingnet Network, Wang Yue, has been arrested by Shanghai police. His whereabouts had been a mystery for more than a month.
Wang Yue’s family informed the company yesterday that he had been “criminally detained” for suspicion of manipulating the securities market, according to the company’s latest filing to the Shenzhen Stock Exchange.
The company said the detention of Wang, who holds 21.44% of its shares, had no effect on its daily operation because he “no longer holds any position in the company”.
Kingnet Network, which went public in December 2015 and publishes browser-based and mobile games such as The Legend of Moon, and MU Miracle, issued a statement in late March saying that Wang Yue had been incommunicado since March 28th and that it was trying to find out what happened to him. Wang, who founded the company in 2008, resigned from the board of directors three days before he went missing.
About a week later, the company confirmed that a district court in Shanghai froze some of Wang’s shares for three years.
Kingnet saw its net profit drop by 64% from RMB 245.6 million (USD 36.2 million) in Q1 2018 to RMB 88.3 million (USD 13 million) for the same period this year. The company also recorded a 3.8 million deficit in its cash flow.