Gree Electronics Chairman Dong Mingzhu made another fuss. This time it was at the extraordinary general meeting held on October 28. In the outflow of the video, Dong Mingzhu pointed out that the shareholders allegedly denounced: “What are the listed companies that give you dividends? I won’t pay you dividends for 5 years. How can you treat me? The more you give (dividends) the more you are proud, the more words you have ……
This paragraph is properly cut, because there are words that are swearing. Dong Mingzhu was on the spot, of course not because she was on the scene, “no one applauded, but she sniffed out the strange atmosphere from this detail.” The EGM had an important vote to issue shares to acquire a 100% stake in the new energy company Zhuhai Yinlong. Previously, after the proposal was put forward, it was questioned by the capital market: Some people think that Gree spent 13 billion yuan to buy Yinlong too high price; others worried that Gree’s move was in cross-border “making cars (production of new energy vehicles), The outlook is uncertain; others have questioned Yinlong’s technology and its profitability.
Dong Mingzhu certainly knows these different voices, but from the point of view of the scene, she seems to attribute this simply to the shareholders’ quick success and only want the stock price to rise without considering the company’s long-term development. She said straightforwardly: “You invest in Gree, don’t talk to me about stock prices or anything.” You should talk about whether this company can develop for 100 years. Of course, this also has some truth. In the long run, the company’s stock price must have performance support, otherwise investors will not be able to obtain long-term returns. In the current domestic capital market, there are indeed many investors holding short-term thinking that only looks at stock prices and does not look at performance.
But from the fundamental relationship between listed companies and investors, Dong Mingzhu’s remarks are biased. In the capital market, since investors have long-term investment, there are short-term and even ultra-short-term, and as long as they meet the trading rules of the stock market and bear the investment risks themselves, what is necessary for listed companies to make irresponsible remarks to investors? Lessons for investors?
More importantly, a company should focus on improving its performance and seeking long-term growth, but this does not mean that investors can be ignored. Listed companies have profits that do not return to shareholders, and certainly violate company laws and other regulations. Otherwise, Dong Mingzhu does not need to emphasize the dividends of Gree. Then, of course, investors have reason to worry that the investment operation of listed companies will not hurt their own interests. Some shareholders questioned Gree’s acquisition of Yinlong, which is precisely because of this concern.
A company once listed will mean becoming a public company. As a listed company, it can raise funds from the capital market for follow-up operations and investment, but it also means that it is responsible for shareholders. It cannot be said that this company wants to raise funds from the capital market and is unwilling to assume its due responsibility. If the listed company does not want to accept the constraints of the shareholders’ opinions, it should not be listed at all. Therefore, for this transaction, what Dong Mingzhu should do is to patiently explain the rationality of the transaction to shareholders and improve shareholder confidence, rather than simply and rudely defending himself with past performance.
In the domestic capital market, there are many company executives who have similar thinking like Dong Mingzhu. For example, Vanke has always performed well, but has ignored the opinions of shareholders and disrespected the interests of shareholders. As a result, the executives of China Resources Group, the company’s largest shareholder, once directly questioned Yu Ke, President of Vanke: “In Vanke’s overall development strategy, Where are the shareholders? The mistrust from the major shareholders has laid the groundwork for this “Millions of War”.
For Gree, the result of scorning shareholders’ opinions is that 15 proposals were not passed at the EGM. If a listed company does not respect the fundamental laws of the capital market, investors will vote against it. Dong Mingzhu gave a lesson to the shareholders, and the investor also gave a lesson to Dong Mingzhu with the voting rights in his hand. Things are as simple as that.
Dong Mingzhu gave a lesson to shareholders, and investors also used the voting rights in their hands to give Dong Mingzhu a lesson.
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