Beijing: One of China’s most prominent technology giants has relinquished ownership and management roles in various enterprises under the business empire it founded nearly 25 years ago, following an unexpected end. of the long legal battle over alleged bankruptcy in the United States.
Since September, Richard Liu Qiangdong, the founder of JD.com and the 155th richest man in the world, with a net worth of $10.8 billion, has sold 45 of his shares in each of the companies that he has four, according to most. new corporate documents. the stake percentage is given. The company’s investment, logistics and healthcare industries.
According to the document, for “management benefit purposes,” the right was transferred to Miao Qin, vice president and head of JD’s life and services business division, because Liu is no longer, a non-executive director, joined the day-to-day work. Organizing JD’s day-to-day work, so signing corporate documents is difficult.
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The latest developments come after Liu, 49, ceded his CEO position in April to longtime friend and business veteran Xu Lei. It’s one of the most popular things an entrepreneur can do to free himself from the daily grind at JD.
Li Chengdong, founder and chief analyst of Beijing-based technology consultancy Dolphin, said Liu is currently absent from China, and his absence makes administrative tasks such as signing documents difficult.
He added that JD can work freely without Liu’s presence as a stable party.
JD did not respond to a request for comment for this article.
Liu has not been seen in public since last month, when a photo surfaced of him and his pregnant wife, Zhang Zetian, in a Minneapolis, Minnesota, online grocery store.
A Chinese student filed a human trafficking case against him in 2019, but just before the trial began, a settlement was reached and Liu was released from the need to testify.
After the embezzlement allegations first surfaced in 2018, Liu began to step down from his corporate positions with honor, which led to his arrest by Minneapolis police.
When he eventually returned to China, he was never charged with a crime, but he renounced his membership in the Chinese People’s Political Consultative Conference, the highest political honor for businessmen.
Liu will step down as chairman of JD in September 2021, and Xu will be responsible for “daily operations and joint development of various enterprises”. JD said at the time that Liu would spend more time “composing the company’s long-term strategies”.
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According to some observers, Liu is following in the footsteps of several Big Tech founders who have stepped down due to China’s regulatory crackdown on the sector but have managed to maintain control.
According to a November 2017 article in the Post, Zhang Yiming, the founder of TikTok owner ByteDance, continues to have significant influence on the company’s strategic decisions, despite giving up his position as CEO and board member to his college roommate Liang Rubo last summer. Is. ,
According to Kim Chang-hyun, assistant professor of strategy at the China Europe International Business School in Shanghai, Liu’s transfer of equity interests may not result in a dilution of his control rights at JD.
JD has a dual-class share structure, which is preferred by tech companies because they can directly control a portion of the shares and have better voting rights.
JD is listed on the Nasdaq and the Hong Kong Stock Exchange.
This is a typical strategy used by team builders, according to Kim.
Although he only owns 14% in JD, Liu was named in his vision for 78% of the total voting rights when JD applied for an initial listing on the Hong Kong Stock Exchange in June 2020.
Liu left management positions at 230 companies under his empire in one year, according to business reports, and will leave another 18 by 2021.
Liu earned 6.6 billion yuan ($930 million) in the first half of this year from buying up his stake in JD Health and American savings shares acquired by a company called Max Smart.
Currently, Liu holds executive positions in 33 companies, while holding 333 management positions each. As of the end of March this year, Liu still holds 76% of the total voting power in the JD, just two points less than two years ago. .
No one can question Liu’s business decisions because other JD executives, such as CEO Xu, own less than 1% of the total common shares.
A former employee close to the company said he believed Liu was still attached to JD and said there had been internal discussions about Liu considering a return to management.
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But outside the organization, Xu has become JD’s new spokesperson, replacing Liu. The CEO spoke at the World Internet Conference last week to tout JD’s status as a “true economic entity” and the company’s strong supply chain, which it says ships to 94% of Chinese consulate within 48 hours of placing the order. Packages can be delivered. The conference is China’s annual showcase for its internet governance model.