Founder of leading Chinese drinks distributor arrested

Lin Jianhua, founder of Nanpu, a subsidiary of Tenwow International Holding, one of China’s biggest importers and distributors of alcoholic drinks and of which he was also the former chairman, has been detained by authorities in Shanghai to “assist investigation”, according to reports by the Chinese media.

Lin Jianhua, former chairman of Tenwow, one of the biggest drinks distributor in China.

The arrest of Lin to assist an ongoing investigation, however, does not necessarily suggest criminal wrongdoing.

Yet the news has sent shock waves through the industry and eventually led Tenwow to halt its trading activities on Hong Kong Stocks and Clearing Board, as announced on 13 August. 

Before the detention, the Shanghai Municipal Public Security Bureau had imposed temporary freezes on the company’s production facilities, offices and warehouses for two to three years.  

It’s unclear at this stage what the investigation is about, but according to Chinese media reports, it’s most likely linked to Nanpu, a subsidiary and the biggest distributor of Tenwow. Tenwow owns a 49% stake in Nanpu with the majority stake held by Shanghai Tangjiu.

Founded in 1992 by Lin, Nanpu distributes Chivas, Martell, Hennessy and other beverage brands, and is one of the top wine and spirits importers in China based on customs figures in 2016. Nanpu imported 2.3 million litres of wine in 2016, making it the eleventh largest wine importer in China.

The company has been distributing California’s E&J Gallo’s entry-level Carlo Rossi for over ten years in mainland China before its partnership was dissolved earlier this year. 

At the height of Carlo Rossi’s popularity in China in 2014, its sales totalled 770,000 cases, accounting for 55% of American wine exports to China in that year. 

Lin’s 25-year-old son has since replaced his father as company chairman.