NEW YORK (BLOOMBERG) – Mr Zhang Jindong has stepped down as the chairman of Chinese retail giant Suning.com, after losing control of his firm following a government-led bailout.
The company announced his resignation in a filing with the Shenzhen stock exchange on Monday (July 12), adding that Mr Zhang will be appointed honorary chairman to guide the firm’s future growth. Mr Zhang, 58, lost control of Suning when the business sold a 16.96 per cent stake to a state-backed consortium for a US$1.36 billion (S$1.84 billion) bailout last week.
The group of investors, led by the Nanjing state asset-management committee and the Jiangsu provincial government, also includes Alibaba Group Holding and Chinese appliance makers Midea Group and Haier Group, smartphone maker Xiaomi and TCL Technology Group.
The bailout, and now Mr Zhang’s resignation, are the end of his reign during which he led the company into an array of businesses, including ownership of the Inter Milan soccer team.
Suning.com had a market value of about 52 billion yuan (S$10.86 billion) before the trading halt. The retail business was weakened by a slowdown in spending during the Covid-19 pandemic. Concerns about its cash flow intensified in September, when Mr Zhang waived his right to a 20 billion yuan payment from property developer China Evergrande Group.
The stock tumbled last month after a Beijing court froze three billion yuan worth of shares held by Mr Zhang – representing 5.8 per cent of Suning.com – and creditors agreed to extend a bond for Suning Appliance Group, which is owned by Mr Zhang and fellow co-founder Bu Yang.
Mr Zhang has a net worth of US$1 billion, according to the Bloomberg Billionaires Index. That is down from a peak of US$11.5 billion in June 2015.