Five years ago, Chau Ching-ngai was one of Shanghai's richest men. The property tycoon had few problems quickly injecting his mainland commercial interests into listed Hong Kong vehicles. With an exclusive Jardine's Lookout address and socialite wife, Chau was also a familiar face among the A-list cocktail set. Today, the 44-year-old is the latest addition to the Independent Commission Against Corruption's 'most wanted' list. In what is being seen as the epilogue to a tumultuous chapter in Chau's Hong Kong business career, the former high-flier has been placed on the graft buster's wish list, having allegedly conspired to defraud the shareholders of a listed company. According to the ICAC, Chau plotted with others between October 2001 and May 2003 to dupe shareholders into accepting a reduced purchase price for the takeover of an unnamed public firm. The ICAC has declined to detail the allegations. The tycoon took over two listed companies during his time in Hong Kong. Perhaps the best known is Shanghai Land, a former wireless internet company previously known as imGO. Chau bought a 60 per cent stake for about $1.5 billion from controlling shareholders that included Hutchison Whampoa and Ericsson, entities not normally prone to being undercut by crafty elements. The second company he acquired through a backdoor listing was a processor of raw materials, Ying Wing Holdings, which became Shanghai Merchants. Chau paid $61.8 million in January 2002 for a 74 per cent controlling stake, triggering a general offer under the takeover code where shareholders were offered 41.8 cents a share. Quite how the businessman could defraud stakeholders into accepting a reduced acquisition price is unclear, unless an element of share manipulation was at play before an offer was made. Ying Wing was a fairly stagnant stock before the takeover, remaining at $1.80 for the eight months to August 2001 in the absence of any trading. By September 2001, the stock price was down to $1.10. The offer was thus at a 62 per cent discount to the trading price. As the share price continued to decline, the offer price however looked more attractive. By the date of the offer, the price on the table was just a 25 per cent discount to the trading price. However, sources close to the securities regulator are puzzled by the allegations, not having been alerted to any such fraud on shareholders. Those familiar with the trials and tribulations of Chau are also perplexed by the decision to pin him on the ICAC's most wanted list, given the fact that his whereabouts are well-documented. Chau received a three-year jail sentence on the mainland in June last year, authorities having found that he manipulated share prices and falsified registered capital. The term raised eyebrows as being on the light side among those who quizzed Chau's political connections. People who have had recent dealings with the businessman say he is in a detention centre, a more attractive residence than a Chinese jail. The chances of Chau returning to Hong Kong at his own will once released seem remote, given the ICAC's clear intent to arrest him at the border. Likewise, the odds of the graft busters receiving co-operation from mainland counterparts for his arrest are scant, given a pervading lack of previous interaction between regulators on both sides. In effect, he has been warned about ever setting foot on Hong Kong soil again. It may be a compromise on paper but those who became embroiled in Chau's misfortunes may appreciate a more sterile end to the whole affair. BOC Hong Kong (Holdings) in particular entered the spotlight in May 2003 after making a $1.77 billion loan to the property tycoon to fund his takeover of Shanghai Land, with $740 million outstanding when Chau was arrested. Then bank chief executive Liu Jinbao was subsequently recalled to Beijing, and the lender was forced to investigate its dealings with Chau to quell rumours of impropriety. In September that year, the bank released its findings, revealing that Chau was granted the loan without examination of his net worth and despite the reservations of the lender's chief risk officer. The incident was dubbed 'a lapse in judgment in a particular instance'. Two years on, the lender looks set to revive a relationship with the businessman, albeit in the form of accepting repayments on sums outstanding from Chau. With a winding-up of Shanghai Land approved recently by independent shareholders, investors will get $480 million in cash, BOC (Hong Kong) will receive $1.44 billion and Chau is to take some of his private companies back from the hands of liquidators including those with a hotel and major piece of land in their portfolio. Chau will thus be in a position to meet debt payments to the bank, bringing the businessman full circle, although he is unlikely ever to make it on to Hong Kong's A-list again.