CEFC China Energy
A CEFC logo is seen at CEFC China Energy's Shanghai headquarter in Shanghai (Photo: Reuters / Aizhu Chen)

One of China's largest energy and finance conglomerates, CEFC China Energy Company Limited, is now facing possible delisting from the Shenzhen Stock Exchange. The possible delisting is the latest in a long line of dramatic events that have seen to the company's downfall following the arrest of its founder and CEO, Ye Jianming.

The Global Fortune 500 company owned a massive portfolio of financial and energy assets in four continents while it was under its mysterious founder. In 2018, the billionaire oil tycoon was arrested by Chinese authorities on charges of bribery.

Ye's arrest and the scandal that ensued crippled the multi-million dollar company, sending its shares spiraling down in the months that followed. The sudden drop in the company's stocks essentially wiped out over $153 million in value in a very short time. The company's listed entity in China, CEFC Anhui International Holdings, has fallen so drastically that it is now way below the one yuan face value threshold.

The Shenzhen Stock Exchange issued a warning to CEFC Anhui on Thursday, informing it of possible delisting. Under the bourse's rules, any company that sees its share prices fall below its face value for 20 consecutive days may face delisting.

When this happens, trading of the company's shares is suspended and the exchange will have up to 15 days to decide whether or not to remove the listing.

The only main issue with CEFC Anhui International Holdings is that its value is now well below the threshold of its face value. Even if the company were to exceed the bourse's 10 percent daily gain limits for the rest of the week, it still wouldn't reach its threshold. The company's stock price has been hovering around 0.67 Yuan as of Wednesday this week.  

Following its founder's arrest, the company has been trying to regain some of its investor's confidence through a series of strategic moves. Last year, the company had attempted to close a restructuring agreement with Jiaozuo Zhongzhou Carbon. Unfortunately, the deal failed to fuel any interest in the stock and prices continued to tumble.

The company's problems, stemming from the allegations against its founder, continue to cause issues. Last month, Chinese authorities announced that it was launching a formal investigation into the former chairman of China Development Bank, Hu Huaibang, for his possible involvement in CEFC's bribery schemes. Investigators have reason to believe that Hu had helped CEFC acquire billions of dollars in credit from the bank.

Prior to Ye's arrest in last year, the US Justice Department filed charges against CEFC for allegedly bribing Chad officials for oil rights through different representatives. The company allegedly paid around $2 million to bribe the president of Chad and $500,000 to bride Uganda's Minister of Foreign Affairs.