The CEO of a Chinese company that owns Stan Lee’s POW! Entertainment was detained by police, and the company’s stock then crashed as much as 90%.
Camsing International’s shares plunged in Hong Kong on Monday. Camsing announced on Friday that its founder and CEO, Lo Ching, had been detained by Shanghai police. The company said it did not know why she was detained.
The stock staged a slight recovery later in the day but dropped again on Tuesday, leaving it more than 85% down for the week — its lowest level in more than four years.
“At the date of this announcement, the directors are unable to ascertain the reasons of, or incidents leading to, the criminal custody of Ms. Lo,” the company said in a stock exchange filing, adding that its business operations remain “stable.”
Camsing declined to comment further. Police in Shanghai did not immediately respond to requests for comment.
The Hong Kong-based company bought POW! Entertainment, which was co-founded by late Marvel Comics legend Stan Lee in 2017. Camsing said it wanted to create “another Marvel” in Asia, referring to the success of the brand behind blockbuster franchises like Spiderman, Black Panther and The Avengers.
In May 2018, Lee sued POW! Entertainment for more than $1 billion, claiming he had been duped into signing away exclusive rights to his name, identify and likeness. Camsing International said in response that complaint was “without merit.” Lee dropped the lawsuit in July 2018. He died in November at age 95.
POW! Entertainment said Tuesday that it was “one of many” subsidiaries of Camsing International but continued to operate independently with a separate management team based in the United States.
“The news today is disturbing to us but will in no way impede our single-minded dedication to our mission as the guardian of the legacy of our founder Stan Lee,” the company said in a statement emailed to CNN Business.
Camsing Global, founded by Lo in 1996, has entertainment interests across animation, film, television and theme parks. It says it has previously worked with Disney, Warner Bros and the NBA, and on prominent franchises like Star Wars, Transformers and World of Warcraft. Camsing Global is the parent company of Camsing International.
Another company Lo controls also plummeted on the Chinese market late last week.
Jiangsu Boxin Investing fell 10% in Shanghai on Friday — the maximum daily move allowed on the city’s stock exchange — after it also announced Lo’s detention. The company said in a statement released midday that Lo was taken into custody on June 20, followed by the detention of its CFO Jiang Shaoyang on June 25.
In the statement, Jiangsu Boxin said police are continuing to investigate the matter, while the company’s operations remain “normal.”
On Monday, Jiangsu Boxin shares were on a roller-coaster ride. They dropped 10% in the morning from Friday’s close before ending the day 10% higher.
Lo’s detention is the second of a leading Chinese executive in Shanghai in less than a week. Police in the city announced last Wednesday that they had detained billionaire Wang Zhenhua, wiping more than $5 billion off his real estate empire in three days.