(Yicai Global) Nov. 29 -- Chinese regulators are investigating the former chairman of Everbright Securities, probably for suspected involvement in the CNY5.2 billion (USD815 million) takeover of MP & Silva Holding, an insider told Yicai Global. The 2016 acquisition of the UK sports copyrights firm by a unit of the brokerage and another firm reportedly involved improprieties.

Xue Feng resigned last April after heading Everbright Securities from November 2016, and he has not been seen in public since. The authorities took Xue away for investigation months ago, and he has been assisting with the probe since resigning, the source said.

In May 2016, Everbright Capital and Chinese entertainment services provider Baofeng Group bought 65 percent of MP & Silva. The London-based company’s founder and major shareholders then set up a rival firm, as they had not signed a non-compete agreement. With the rights for soccer games from the Italian Serie A and French Ligue 1 going to the competitor, MP & Silva filed for bankruptcy in October 2018.

Baofeng founder and Chief Executive Feng Xin reportedly offered bribes to the Everbright Capital executives involved in the acquisition. Chinese police subsequently imposed compulsory measures on Feng and Everbright Capital’s investment director Xiang Tong. The case is still under investigation.

Everbright Securities lost about CNY4.55 billion over the past three years because of the acquisition, according to the firm’s annual reports. In June, the Shanghai-based company said it had filed a USD661 million lawsuit with a British court against MP & Silva’s former shareholders.

Xue was also president of Everbright Securities between January 2014 and October 2017. Before joining the brokerage, he worked at the People’s Bank of China and the China Banking and Insurance Regulatory Commission.

The discipline inspection commission of China’s northeastern Heilongjiang province is probing Du Xiongfei, general manager of the Everbright Securities’s debt financing and investment banking headquarters for alleged illegal behavior, the authority said on its website on Nov. 17. But Du’s case is unlikely to be related to MP & Silva, Yicai Global learned.

Shares of Everbright Securities [SHA: 601788] closed down 1.8 percent in Shanghai today at CNY14.58 (USD2.28) apiece. Its Hong Kong-listed stock [HKG: 6178] ended 1 percent down at HKD5.92 (76 US cents).

Editor: Futura Costaglione