Chinese billionaire investor ups stake in Lending Club

By Daniel Lanyon on Tuesday 21 June 2016

Alternative Lending

The Singapore based Shanda Group owned by Chen Tianqiao has increased its stake in beleaguered P2P/marketplace lending platform Lending Club to 15.13 per cent, according to regulatory filings.

The privately owned investment group owned 11.7 per cent of Lending Club two days after its former chief executive officer was ousted in May by the company’s board over allegations of impropriety.

An internal inquiry had found Renaud Laplanche had doctored the date of origination of some loans that were due to be repackaged and sold on to an investment bank. Also, the firm found that Laplanche owned units in a fund that was buying Lending Club’s loans but this had not been flagged to Lending Club’s internal compliance team.

Lending Club’s share price plummeted in the wake of the scandal six weeks ago.  It fell more than 40 per cent in the week following Laplanche’s departure with the share price touching $3.5, although today it has made some recovery having risen to $5.

Performance of share price over 3 months

Source: Google

Even before the news of Laplanche’s alleged transgressions, Lending Club’s stock had been falling since its initial rally in the few months following its December 2014 initial public offering.

Performance of share price since IPO

Source: Google

Laplanche is rumoured to be plotting a takeover of Lending Club with the help of private equity and investment banks according to recent reports, so far unconfirmed.

Chen Tianqiao is one of mainland China’s richest people, having built a fortune in online gaming and publishing. The 43 year-old’s firm also own a 9.9 per cent stake in US-base asset management firm Legg Mason.

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