China’s M&A star told his employees to be bold, then he disappeared

Fan Bao set out to build the JPMorgan of China, successfully straddling the divide between China and the West (WSJ)
Fan Bao set out to build the JPMorgan of China, successfully straddling the divide between China and the West (WSJ)


  • Beijing’s detention of tech rainmaker Fan Bao rattles an industry that thought the crackdown was over

In mid-January, star Chinese investment banker Fan Bao, architect of the deals that created some of China’s most dominant technology companies, appeared at his bank’s annual party in Beijing. He brought along his children, who played instruments and performed a rendition of the Coldplay hit “Yellow." He exhorted the hundreds of staffers in attendance to “Go Forward Boldly."

A few weeks later, he disappeared.

For the past month, the 52-year-old banker—who set out to build the JPMorgan of China and successfully straddled the divide between China and the West—has been held incommunicado in a detention system run by the Communist Party’s anticorruption agency.

He vanished just as hopes were building in China’s battered technology sector that a long-running government crackdown was ending. Former economic czar Liu He had also recently told the elite audience at Davos that China was open to business again. But the seizure of Mr. Bao wiped out that goodwill and sent shivers through China’s business and finance community.

“Mr. Bao is like thousands of other people who seized the opportunities of China’s embrace of market economy, and relied on their professional capability to achieve success," said Chongyi Feng, an associate professor in China Studies at the University of Technology, Sydney. “So now, everyone who has achieved success that way feels that they are at risk…. The threat is very real."

Privately, close associates of Mr. Bao have been dismayed by his detention. China Renaissance Holdings Ltd., the boutique investment bank he founded and ran, is a relatively small firm, making it unusual that it would draw this manner of government scrutiny. Colleagues, business partners, friends and acquaintances of Mr. Bao are worried about his safety and are hoping he will soon resurface publicly. “I feel utterly disillusioned," said a person close to Mr. Bao.

The jolt to business people’s confidence also comes as anxiety over China’s direction, its curtailing of people’s rights, and the way it managed the Covid-19 pandemic is leading more middle-class and wealthy Chinese citizens to relocate to other countries. Global investors have been rethinking their exposure to the world’s second-largest economy following a selloff over the past two years that was largely caused by Beijing’s regulatory crackdowns and policy decisions. The MSCI China Index fell 23% in 2021 and 24% in 2022.

“Confidence has been very much shattered," said Zhiwu Chen, a professor and chair of finance at the University of Hong Kong’s business school. “The government’s desire to have private equity and venture capital invest more is very much undermined," he added.

China Renaissance, which helps companies raise money and invests in startups, has been trying to reassure clients and employees that business is operating normally. Its shares lost more than a quarter of their value in a single day after the firm disclosed on Feb. 16 that it had been unable to contact or locate Mr. Bao, who is also its chairman and controlling shareholder.

Some Chinese entrepreneurs who previously went missing have reappeared quickly. Guo Guangchang, the billionaire chairman of Shanghai-based conglomerate Fosun Group, emerged days after a mysterious detention by authorities in late 2015. He continues to run Fosun and was never charged with any wrongdoing.

Xiao Jianhua, a Chinese financier who ran a conglomerate called the Tomorrow Group, was taken from Hong Kong in 2017 and didn’t reappear for five years. He turned up in a Shanghai court last year to face corruption charges and was sentenced to 13 years in prison.

Mr. Bao was taken in to assist in a corruption probe involving Cong Lin, a former president of China Renaissance who joined the firm in 2020 after leaving a subsidiary of Industrial & Commercial Bank of China Ltd., one of the country’s biggest state-owned banks, The Wall Street Journal has reported.

While Mr. Cong was at ICBC, one of its units extended a $200 million credit facility to China Renaissance. One question investigators have is whether Mr. Bao gave Mr. Cong a position at China Renaissance as part of a quid-pro-quo arrangement, the Journal reported. ICBC’s international division was also one of the sponsors of China Renaissance’s 2018 IPO and received fees from the company’s share sale.

None of this has been disclosed formally by Chinese authorities, which didn’t reply to a request for comment for this article.

“It’s really a due process risk in China," said Andrew Polk, co-founder of Trivium China, a consulting firm. “The problem is not the CEOs or chairmen of these companies getting hauled away for questioning. It’s that nobody knows where they went, and it’s done with no forewarning, with secrecy, and we only know afterwards."

Born in Shanghai to a pair of diplomats, Mr. Bao grew up in China’s financial capital and often spent long periods apart from his parents while they were stationed overseas, he said in a television interview with American journalist Nancy Merrill in 2011.

He said he was a troublemaker during his elementary-school years and was often ordered by his teachers to write self-criticism letters for picking fights with other students, making noises in classrooms or turning up late.

Mr. Bao spoke English fluently and embraced Western culture early on. In high school, he donned Nike sneakers, which were relatively uncommon in China in the 1980s. He studied English literature at the country’s prestigious Fudan University, then went to Europe, where he earned a degree in business and economics at the BI Norwegian School of Management.

He started working on Wall Street in the mid-1990s, joining Morgan Stanley Dean Witter and then Credit Suisse First Boston before returning to Morgan Stanley to help arrange mergers and finance deals. As a junior banker, he worked on deals for clients that included China’s state-owned telecom carriers and Huawei Technologies Co., according to people familiar with the matter.

Mr. Bao founded China Renaissance in 2005 and set out to help technology businesses in China raise capital for growth. In private, Mr. Bao told close associates that he wanted to make his firm into China’s J.P. Morgan—the original empire-building operation where John Pierpont Morgan financed and merged companies in industries like steel and railroads to create the giants of America’s Gilded Age.

“He was just very hardworking and very knowledgeable. Even at a junior level he commanded a lot of respect," said Duncan Clark, who worked with Mr. Bao for a few months at Morgan Stanley and now runs BDA China, an investment-advisory firm. Mr. Clark said Mr. Bao was a hustler who didn’t take himself too seriously and who put in exceedingly long hours.

A Chinese television show in 2008 featured Mr. Bao as “the investment banker who looks most unlike an investment banker," referring to how he was recently filmed wearing a flowery shirt and ripped jeans while smoking a cigar.

Mr. Bao believed China was on the cusp of a new-economy revolution and connected early on with young entrepreneurs who were trying to get their internet-technology startups off the ground. In a video marking China Renaissance’s 10th anniversary in 2015, he said the firm’s goal was to become the “most awesome" investment bank in China in the next 10 years.

That year, China Renaissance was the sole financial adviser behind the mergers that created ride-hailing service Didi Global Inc., a company that eventually forced Uber to retreat from China, and food-delivery operation Meituan. The internet platforms had all been locked in cash-burning battles as they vied for more market share. Mr. Bao used his deep connections with company founders and their shareholders to bring archenemies in business to the negotiating table.

In 2018, China Renaissance raised about $350 million in an IPO in Hong Kong that drew investments from high-profile institutions including fintech firm Ant Group Co. It was often the only non-state-owned Chinese bank on multibillion-dollar IPOs, such as those of PDD Holdings Inc., Meituan and short-video app operator Kuaishou Technology.

As he became more successful, Mr. Bao sported modish glasses and crisp tailored business suits, and was a regular speaker at international conferences. He used to drive a Ferrari and sometimes let his business partners take his collection for spins in Beijing, according to people who interacted with him. Friends remember him joking about how he once wore a leather jacket to a formal gathering and was mistaken for a driver by the valet.

Meanwhile, many of the companies he worked with became targets. The government stopped Ant Group’s 2020 IPO at the last minute and forced a wholesale restructuring of the company. It forced Didi to unwind its U.S. IPO, which China Renaissance had helped underwrite. Meituan was fined the equivalent of more than $533 million for antitrust violations.

Mr. Bao tried to adapt to the new environment, shifting his attention to pursuing deals in industries like semiconductors that remained in Beijing’s good graces.

In May, Mr. Bao left the country and visited investors in the Middle East, Southeast Asia and the U.S., according to people familiar with the matter. He returned to China in July and underwent weeks of quarantine.

Mr. Bao’s last post on Chinese social media WeChat was on Jan. 9, a few days before the China Renaissance party. He congratulated Fenbi Ltd., a vocational training provider and a portfolio company in his firm’s fund, on its Hong Kong listing. Under his personal status, Mr. Bao had written: “Dream as if u’ll live forever, live as if u’ll die today."

Write to Jing Yang at and Rebecca Feng at

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