Eliza Wong
The Stock Transfer Spiral
China’s snacking giant Liangpin Shop (603719.SH) finds itself embroiled in a high-stakes ownership quagmire after abrupt changes to its share transfer arrangements triggered fierce legal retaliation. With Guangzhou Light Industry Group (广州轻工集团) filing lawsuits and freezing founder Yang Chunhong’s shares, the Wuhan-based company’s planned transition to new controlling owners now hangs in judicial balance. This escalating conflict arrives amid deteriorating financials – Liangpin Shop anticipates up to 105 million yuan in losses for first-half 2025 following last year’s red ink.
Core Developments
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– Shareholder lawsuits freezing 19.89% of company stock
– Sudden transfer shift to Wuhan state-backed investors
– Substantial valuation collapse from peak 34 billion yuan
– Parallel 5.1% stake sale to Wuhan Lin Konggang entity
Guangzhou’s Seething Legal Response
Guangzhou Light Industry’s fury stems from what it terms ‘willful breach of contract’ by Yang Chunhong’s investment vehicle Ningbo Hanyi (宁波汉意). After signing preliminary agreements this May transferring Liangpin Shop shares to the Guangzhou state enterprise–owned by the Guangzhou SASAC–Ningbo Hanyi pivoted unexpectedly to strike deals with Wuhan institutions. ‘To safeguard Liangpin Shop’s normal operations and minority shareholders’ interests, we still exercise restraint,’ stated a Guangzhou Light Industry representative despite initiating litigation.
On July 14, Guangzhou Intermediate Court formally accepted the contract dispute case, freezing 79.76 million shares originally destined for Guangzhou’s ownership control. This tactical freezing prevents share registration transfers–a severe bottleneck hurting Wuhan’s parallel acquisition push.
Wuhan’s Lightning Acquisition Move
Parallel to the legal storm emerged Wuhan’s decisive power grab. On July 17, Yang Chunhong announced two coordinated transactions transferring controlling interest:
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– Primary sale: Transferring 21% stake to Wuhan Changjiang International Trade – controlled by Wuhan SASAC – for 1.046 billion yuan
– Secondary sale: Selling 5.1% stake to state-owned entity Wanggu Chuangtou at 254 million yuan
Collectively, these agreements establish Wuhan Municipality as Liangpin Shop’s prospective controlling shareholder. The premium-priced deals Section 3: The Financial Consequences For Yang Chunhong’s original backers, Liangpin Shop’s unfolding battle illuminates the treacherous exit pathways awaiting Chinese entrepreneurs post-listing–especially transfer deals contravening preliminary state-investor understandings. Until Guangzhou’s lawsuit concludes abruptly or incrementally, Wuhan inherits not Liangpin Shop’s business–but its ownership dispute.
