By Tom Hancock
There’s a new company in the running to buy a decommissioned British aircraft carrier. Just one problem: the company’s head is in China, serving a 14-year jail sentence for insider trading.
Eagle Vantage, an asset management firm based in Hong Kong, has announced it will enter the bidding to buy the HMS Ark Royal. The 10,000 ton ship was decommissioned by the Royal Navy last year, and is currently listed for auction on the British Ministry Of Defence’s website. According to a spokesperson from Eagle, the company hopes to turn the ship into a “mobile exhibition platform”.
Eagle’s majority stakeholder is Huang Guangyu, founder of China’s largest electronics retailer, Gome. Huang was once China’s richest man, with a fortune of US$6.3 billion. Last year he was put on trial in Beijing and sentenced to 14 years in jail on charges of insider trading and bribery.
Commentators complained that Huang’s case was used by Chinese authorities to send a warning to the business community. Corruption is common in Chinese business circles, and is often ignored by officials who stand to benefit from insider deals. But cultivating good relations with party officials can be crucial. Unlike other successful Chinese entrepreneurs, Huang never joined the Chinese Communist Party, and stayed aloof from politics.
Huang refused to give up control of Gome company even from his prison cell. Using his 34 percent stake in the company, he promoted his sister to the company’s board of directors, and engaged in a year-long campaign to get rid of Gome’s chairman, Chen Xiao. Chen, who was seen as a rival to Huang, left the company this March.
Zhao Qiguang, Eagle’s project manager in charge of the bid, told the Global Times newspaper that the value of the bid was a “a trade secret.” Zhao also said that the company planned to transport the retired aircraft carrier to Hong Kong or Macao, and not to the Chinese mainland.
Chinese media have been speculating about how closely Huang’s asset management firm Eagle is connected with his electronics retail company Gome. A company insider told the Evening News [Chinese] that the two companies were not directly related, but Gome is interested in the project, and may turn the ship into a “giant floating electronics market”, providing a “relaxing shopping experience” aimed at high-end consumers.
British newspapers reported proposals that the Ark Royal be used as a floating heliport on the river Thames. Its unclear how the British press will greet prospect of the ship, which served in the Gulf and Bosnian wars, becoming a pleasure dome for Chinese electronics consumers.
China launched its first aircraft carrier last month.
The results of the Ark Royal auction will be announced next month.