BEIJING (BLOOMBERG) - China sentenced the former chairman of liquor giant Kweichow Moutai to life in prison for taking bribes of 112.9 million yuan (S$23.59 million).
Yuan Renguo, who was arrested in 2019, was found guilty of taking the bribes between 1994 and 2018, according to a statement late Thursday (Sept 23) from a court in the southwest province of Guizhou, where Moutai is based. He accepted the payments to help distributors secure work with the distiller and increase allocations of the company's prized liquor bottles, the court said.
Yuan, 64, quietly left Moutai in 2018 after 18 years at the helm. His arrest triggered a broader anti-graft crackdown by authorities on the premium distiller's then-management team, including Nie Yong, the former head of Moutai's e-commerce unit. There have since been frequent leadership changes at the company, with three chairmen appointed in the last three years, all ex-local government officials.
Moutai produces premium baijiu, the drink of choice for elites in China. In recent years, the company has worked to circumvent its wide distributor network and sell more of its product directly to consumers, a response to regulators' scrutiny of distributors' hoarding bottles and bidding their prices up. Yuan once said he sought to build a global liquor investment group and lead Moutai to "become a respected world-class enterprise," including by planning IPOs for the company's e-commerce and agricultural arms.
His successors have placed their focus on controlling the prices of Moutai's liquor to avoid regulators' attention and bypassing its network of distributors.
The world's most valuable liquor maker, Moutai expects revenue to grow 10.5 per cent in 2021. The company posted its slowest annual sales increase in five years in 2020, as the pandemic affected spending in the world's largest consumer market. Its shares have fallen 18 per cent this year.