News media business owner and democracy advocate Jimmy Lai has quit as chairperson of publishing company Next Digital, which publishes the free Apple Daily newspaper he founded in 1995.
Lai's resignation is likely an attempt to distance the company from his continuing legal battles over security law violations and allegations of fraud.
The share price of Next Digital rose as much as 25% to HK$0.31 ($0.04) early Wednesday in a show of support for the departing chief before giving back almost all of those gains. It was last trading up almost 4% at HK$0.27. The stock price rose more than 1,100% in two days in August when Lai was arrested.
"Lai Chee Ying has tendered his resignation as the chairperson of the board and an executive director of the company," Next Digital said in a filing to the Hong Kong Stock Exchange.
The outspoken critic of the Chinese Communist Party is leaving to "deal with his personal affairs" according to the company. Lai was charged with sedition earlier this year.
He will be replaced as chairperson by Next Digital's nonexecutive director Ip Yut Kin, 69, for a two-year term overseeing the publishing company valued at approximately HK$685 million ($88.4 million). In addition to Apple Daily it publishes the monthly Next magazine.
Prosecutors allege Lai used the newspaper and his Twitter reach to encourage international sanctions against Hong Kong officials - a charge he refutes.
The news media business owner was granted bail before Christmas after spending weeks in police custody over charges of fraud followed by allegations of sedition and collusion with foreign governments.
His release was not well received by members of Hong Kong's pro-establishment community.
"Lai is notorious and extremely dangerous, yet he became the first suspect to be granted bail after being arrested for violating the national security law, which is inconceivable," an article in the People's Daily, a propaganda organ of the Communist Party, said.
Prosecutors immediately lodged an appeal to revoke his bail which will be heard on new year's eve by three judges including the incoming and outgoing Chief Justices.
Severing ties between Lai and Next Digital will likely prove a boon to the company's share price, which has seen dramatic rises and falls over the course of 2020.
Following Lai's arrest in August, the stock grew more than 10-times over before plummeting to within single percent of its former value days later.