(Refiles to fix spelling of database in third para)
By Alex Frew McMillan
HONG KONG, Aug 31 (Reuters) - Agile Property Holdings , one of China’s largest property developers, said on Friday its chairman has been arrested by Hong Kong police in connection to a case of alleged indecent assault.
Chen Zhuo Lin, the company’s founder, was arrested on Thursday, Agile said in a filing to the Hong Kong stock exchange. The arrest comes at a time when Chinese property companies are under pressure from government efforts to make housing more affordable in the world’s second-largest economy.
According to a Thomson Reuters database, Chen is 49 and earned a salary of 3.7 million yuan last year from Agile. Like many listed Chinese developers, the company patriarch continues to control the bulk of the stock. His family trust, Top Coast Investment, owns 63 percent of the company’s shares.
Local media reported that a personal assistant of Chen’s had levelled the accusations. When contacted by Reuters about the alleged assault prior to Chen’s arrest, the company failed to respond. Hong Kong police could not immediately be contacted for comment.
Chen, who has yet to be charged, has been released on bail, the company said. Agile said the arrest “has not affected and will not affect the normal business and operations of the group.”
Agile’s shares fell 2 percent in early trade, but are still up 32 percent so far this year as investors factor in easier lending conditions in China.
Agile posted property sales of 31.5 billion yuan ($5.0 billion) in 2011, ranking it ninth among listed Chinese developers.
The arrest comes as mainland home builders are facing intense funding pressure after more than two years of restrictions by Beijing to curb property speculation and hold back what were run-away gains in home prices. That has resulted in hefty restrictions on how many homes Chinese people can buy, hampering sales for developers that rely on advance purchases to fund existing projects.
Buyers have been shifting their attention to companies with strong brand names, concerned that weaker developers may run aground financially.
Agile, which is celebrating its 20th anniversary this year, is based in the southern Chinese city of Guangzhou, but has been nimble in expanding into western China as home builders look to diversify away from the country’s “first tier” cities, where the price gains have been steepest. ($1 = 6.3496 Chinese yuan) (Reporting by Alex Frew McMillan; Editing by Richard Pullin)