SMIC CEO voted off board of directors
By Zhu Shenshen |
July 1, 2011, Friday
|
Print Edition
Print Edition
DAVID Wang, chief executive of Shanghai based Semiconductor Manufacturing International Corp, will leave the Chinese mainland's biggest contract chip maker after he was voted off the board of directors, an industry source told Shanghai Daily yesterday.
The vote to remove Wang shows a conflict between shareholders and senior management, the source said.
"Wang plans to leave SMIC and this incident is bad for the Chinese semiconductor industry," said the source close to the issue, who declined to be identified.
Meanwhile, Hong Kong-listed SMIC, whose Chairman Jiang Shangzhou died on Monday, asked for trading in its shares to be halted yesterday.
SMIC's shareholders rejected CEO Wang's reappointment as director of the board and the company requested its shares be suspended from trading pending the release of "price-sensitive" information, the Shanghai-based chip maker said in a statement yesterday.
Holders of 5.33 billion SMIC shares, or 58 percent of the votes, opposed Wang's reappointment, the company said.
Such votes are usually controlled by big shareholders because small investors have little influence, industry insiders said.
State-owned Datang Telecom is SMIC's biggest shareholder with a 19 percent stake.
"In the long term, it aims to get controlling power in the company," said the unidentified source. "Obviously it has a different view of SMIC's performance than Jiang and Wang."
Analysts expressed surprise because SMIC had been turning things around.
Wang was named CEO in 2009 and SMIC returned to profitability in 2010 after losses for five straight years.
The vote to remove Wang shows a conflict between shareholders and senior management, the source said.
"Wang plans to leave SMIC and this incident is bad for the Chinese semiconductor industry," said the source close to the issue, who declined to be identified.
Meanwhile, Hong Kong-listed SMIC, whose Chairman Jiang Shangzhou died on Monday, asked for trading in its shares to be halted yesterday.
SMIC's shareholders rejected CEO Wang's reappointment as director of the board and the company requested its shares be suspended from trading pending the release of "price-sensitive" information, the Shanghai-based chip maker said in a statement yesterday.
Holders of 5.33 billion SMIC shares, or 58 percent of the votes, opposed Wang's reappointment, the company said.
Such votes are usually controlled by big shareholders because small investors have little influence, industry insiders said.
State-owned Datang Telecom is SMIC's biggest shareholder with a 19 percent stake.
"In the long term, it aims to get controlling power in the company," said the unidentified source. "Obviously it has a different view of SMIC's performance than Jiang and Wang."
Analysts expressed surprise because SMIC had been turning things around.
Wang was named CEO in 2009 and SMIC returned to profitability in 2010 after losses for five straight years.
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