Two of leading developer China Vanke Co shareholders have proposed to dismiss company founder and Chairman Wang Shi, according to a filing on the Shenzhen Stock Exchange.
The two shareholders, Shenzhen Jushenghua and Foresea Life Insurance, units of private developer Baoneng Group, have proposed the dismissal of 12 company executives, including Wang, it said.
The two companies together hold more than 10 percent of Vanke's shares.
This is the latest development in the battle between Vanke's management and its controlling shareholders over control of the company.
In December 2015, Shenzhen-based Baoneng replaced State-owned China Resources Co as Vanke's largest shareholder, but Vanke's management, including Wang, did not welcome the change. Media reports said that Vanke held talks with several large enterprises, aiming to take back control from Baoneng by introducing new investors, but without any results.
New changes took place as Vanke announced cooperation with Shenzhen Metro Group Co.
Vanke announced on June 17 that it would acquire a unit of Shenzhen Metro for 45.6 billion yuan ($6.9 billion), in a deal that would make the State-owned subway operator its largest shareholder.
However, the plan met with opposition from major shareholders. Shenzhen Jushenghua and Foresea Life Insurance said in a statement on Thursday that the deal would dilute the interests of existing shareholders.
It also said that Vanke's board isn't representing shareholders' interests in a balanced way and the company is controlled by insiders, which is harmful for the company's long-term growth.
China Resources, currently the second-largest shareholder of Vanke, also opposed the deal. It said Thursday that it opposes Vanke's plan to buy assets from Shenzhen Metro, but supports its business cooperation with the subway operator.
The China Securities Regulatory Commission said on Friday that it would look into Vanke's restructuring plan.
Wang Shi called Baoneng's move a hostile takeover and launched what's now an ongoing effort to shake off the controlling stakeholder, according to a report by financial website caixin.com on Friday.
"When State-owned enterprise China Resources, the one you trusted and relied on, has publicly aligned with the hostile takeover you tried to stop and denied Vanke's management … It's like a storm is about to break or your mom's going to remarry. What can you say?" Wang posted at WeChat "moments" on Sunday, according to stcn.com on Sunday.
Wang also forwarded an article about the matter of him being forced to quit the WeChat account and commented that "Life is like a stage. When you appear on the scene, there's already a day for the curtain call. But it's not the right time now, so why should I hurry," according to a report by stcn.com on Sunday.
China Resources is looking for ways to reclaim the crown as Vanke's biggest shareholder, said Hua Sheng, an independent member of Vanke's board of directors, in a Shanghai Securities News article on June 24, according to caixin.com.
"Apparently, the conflict over the preliminary [asset restructuring] plan between the opposing sides is fundamental and cannot be reconciled immediately," Hua, who voted in favor of the Shenzhen Metro deal, was quoted as saying by caixin.com.
The independent directors' role as the vital minority who determines the voting result in the Chinese stock market has raised widespread discussions in the market, while also triggering a debate over their position and function, according to the report from the Shanghai Securities News.
