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Gome's Huang asks for support
Source: Xinhua |
September 28, 2010, Tuesday
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Print Edition
Print Edition
THE jailed founder of Gome, China's largest home appliance retailer, urged shareholders to support his bid to dismiss the company's current chairman amid a struggle to retain control of the firm.
Huang Guangyu, the founder, made the call in a statement late Sunday as a special general meeting approaches.
"In order to ensure the long-term stability of Gome, we solemnly call on you to actively take part in the special shareholders' general meeting and vote in favor of our resolutions to ensure the company's long-term stability," according to the statement made in the name of the Founding Shareholders.
Huang and Chen Xiao, Gome's existing chairman of the board of directors, have been battling for control of the company since Huang was jailed in 2008 for 14 years for bribery and insider trading.
At the special general meeting to be held today, shareholders will discuss and vote on whether to support Huang's proposals for removing Chen and another executive director from their positions, revoking a general mandate that permits the company's directors to issue Gome shares, and appoint two new executive directors representing Huang and other "Founding Shareholders."
The statement accused Chen of not acting and speaking "in the best interests of the company and its shareholders."
"Chen had publicly stated his wishes to dilute the equity interests of the Founding Shareholders, breaking free of the Founding Shareholders' supervision and having overriding control over the company," it said.
Huang and his wife hold about 32 percent of the company's shares. They would lose their right to veto important company proposals if more Gome shares are issued and theirs become diluted.
The current management, led by Chen, has been neglecting the firm's development and Gome is losing its leading market share to competitors, the statement added.
On the proposal to appoint two new representatives, the statement said it is a reasonable request of the Founding Shareholders to be represented on the company's board.
Phone calls made to Gome were not answered.
The power struggle has triggered heated discussions in China. While some experts justify Chen's taking over as a sign of progress in China's corporate system, most Internet users and some businessmen say Chen betrayed his boss to take over the company.
Internet users also worried that if Chen wins, United States-based Bain Capital - Chen's backer - would eventually merge Gome, which is regarded by many as a national brand.
Huang Guangyu, the founder, made the call in a statement late Sunday as a special general meeting approaches.
"In order to ensure the long-term stability of Gome, we solemnly call on you to actively take part in the special shareholders' general meeting and vote in favor of our resolutions to ensure the company's long-term stability," according to the statement made in the name of the Founding Shareholders.
Huang and Chen Xiao, Gome's existing chairman of the board of directors, have been battling for control of the company since Huang was jailed in 2008 for 14 years for bribery and insider trading.
At the special general meeting to be held today, shareholders will discuss and vote on whether to support Huang's proposals for removing Chen and another executive director from their positions, revoking a general mandate that permits the company's directors to issue Gome shares, and appoint two new executive directors representing Huang and other "Founding Shareholders."
The statement accused Chen of not acting and speaking "in the best interests of the company and its shareholders."
"Chen had publicly stated his wishes to dilute the equity interests of the Founding Shareholders, breaking free of the Founding Shareholders' supervision and having overriding control over the company," it said.
Huang and his wife hold about 32 percent of the company's shares. They would lose their right to veto important company proposals if more Gome shares are issued and theirs become diluted.
The current management, led by Chen, has been neglecting the firm's development and Gome is losing its leading market share to competitors, the statement added.
On the proposal to appoint two new representatives, the statement said it is a reasonable request of the Founding Shareholders to be represented on the company's board.
Phone calls made to Gome were not answered.
The power struggle has triggered heated discussions in China. While some experts justify Chen's taking over as a sign of progress in China's corporate system, most Internet users and some businessmen say Chen betrayed his boss to take over the company.
Internet users also worried that if Chen wins, United States-based Bain Capital - Chen's backer - would eventually merge Gome, which is regarded by many as a national brand.
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