CHINA New Town Development Co has suspended vice-chairman and executive director Shi Jian as sister company SRE Group investigates certain alleged unauthorised transactions carried out by Mr Shi.
Hong Kong-listed SRE Group announced on Thursday that Mr Shi had, without the knowledge of SRE Group's other directors, undertaken certain agreements with third-party financial institutions that required SRE Group to guarantee the repayment obligations of certain subsidiaries of China New Town Development.
Most of those subsidiaries were sold to SRE Investment Holding, a substantial shareholder of China New Town Development and a 51.01 per cent shareholder of SRE. Mr Shi is the controlling shareholder of SRE Investment.
SRE Investment in March delayed its payment to China New Town Development for the assets, although Mr Shi had provided a guarantee for the punctual payment of that consideration.
China New Town Development shares last traded at 5.7 Singapore cents on Wednesday.