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produced by radar finance | edited by mo enmeng | deep sea

even though they have already "separated", the rumors surrounding dongfang zhenxuan have not completely disappeared with the independence of yuhui xingxing.

on august 26, oriental selection issued a statement to refute the rumors circulating on the internet that "oriental selection organized malicious attacks on dong yuhui and yuhui tongxing", "dong yuhui used the reward money to buy back yuhui tongxing", and even "he had to pay 6 million to buy the company" and "yu minhong cashed out 800 million at a high price".

with the release of this rumor-refuting statement, public attention has once again focused on the complex relationship between dongfang zhenxuan and yuhui xingxing. in fact, yuhui xingxing's independence is, to a certain extent, precisely to avoid external public opinion disputes as much as possible, but the current online discussion about the relationship between the two companies has not completely stopped.

undoubtedly, dong yuhui has brought a significant boost to the performance of oriental selection. with the departure of dong yuhui, oriental selection will face even more severe challenges in its future performance. on the one hand, the growth of oriental selection's followers on the douyin platform may slow down; on the other hand, after the divestiture of yuhuixing, the pressure on oriental selection's gmv growth will further increase.

it is worth mentioning that in the aftermath of the "small essay" incident in the oriental selection, luo yonghao's nickname for yu minhong, "stingy man", once caused heated discussions on the internet. however, in this "peaceful breakup" with dong yuhui, yu minhong was quite generous, paying a "sky-high breakup fee" of 358 million yuan.

this "sky-high breakup fee" specifically includes: 141 million yuan already paid into dong yuhui's account, 141 million yuan of remaining profits awarded to dong yuhui, and 76.5855 million yuan for the acquisition of hui tongxing "arranged" by yu minhong, and this does not include dong yuhui's half-year salary.

radar finance found that since the listing, yu minhong has not reduced his holdings of oriental selection's shares. however, as the soul of the company, yu minhong has also received a lot of returns from the company. from fiscal year 2019 to fiscal year 2023, yu minhong received a total of 76.518 million yuan in compensation from oriental selection.

in april last year, oriental selection also granted yu minhong shares worth hk$43.5 million. according to data from eastmoney, as of the end of november last year, yu minhong directly held 5.06% of oriental selection's shares, while new oriental, of which he is the actual controller, also held 54.89% of oriental selection's shares.

sun dongxu, who was previously pushed to the forefront of public opinion in the "small essay" storm, has also received generous remuneration and stock rewards from oriental selection in the past few years.from fiscal year 2019 to fiscal year 2023, sun dongxu received a total of 61.567 million yuan in compensation from oriental selection.in the share incentive plan announced by oriental selection in april last year, sun dongxu was also awarded shares worth hk$87 million. according to data from eastmoney, as of the end of november last year, sun dongxu held 1.48% of oriental selection's shares, which are currently worth hk$182 million.

rumors continue to linger after eastern selection "splits up", denies malicious attack on dong yuhui

on the evening of august 26, dongfang zhenxuan released a statement on its official weibo regarding some untrue statements. this time, dongfang zhenxuan mainly refuted three kinds of statements circulating on the internet.

first, there is the rumor that "dongfang zhenxuan organized malicious attacks on dong yuhui and yuhui xingxing". in response, dongfang zhenxuan stated that it has never organized the so-called "12 studios, more than 3,000 people, more than 60,000 accounts on various platforms, and a total consumption of more than 8,000,000", and "mobilizing all employees and relatives" to discredit dong yuhui.

dongfang zhenxuan also stated that the company has collected evidence for the rumor and will report it to the relevant authorities. since becoming independent, dongfang zhenxuan and yu minhong have never participated in any evaluation or attack against dong yuhui, and hope that everyone will provide clues to this type of rumor, and they will deal with it in a timely manner.

as the helmsman of oriental selection, yu minhong is deeply touched by the negative impact of online public opinion. as early as may this year, during a live broadcast with zhang wenzhong, the founder of wumart group, yu minhong admitted that in the past year, he had been abused, accused and insulted more times on the internet than ever before.

in the open letter issued when he officially announced his "breakup" with dong yuhui, yu minhong also stated that as a company based on the internet, the power of public opinion often affects the company's development. "although there have been no obstacles to communication between yuhui and me so far, the complex public opinion disputes, coupled with the guidance and rumors of a few forces with ulterior motives, have directly led to the rift between oriental selection and yuhui xingxing." yu minhong even began to have concerns about appearing in front of the camera of yuhui xingxing or oriental selection.

yu minhong bluntly stated that these external comments also brought a lot of negative influences to himself and dong yuhui. "at the same time, i was also deeply caught in the tide of public opinion, constantly attacked and stigmatized. yuhui also suffered a lot of unwarranted accusations and harm, and this situation has continued to this day. this public opinion environment has led to huge uncertainty in the development of both companies. the stock price fluctuated violently due to external influences, and the company's credibility and reputation declined sharply."

it was precisely out of considerations such as ensuring that yuhui tongxing had a better development stage and avoiding business conflicts and public opinion disputes that yu minhong and dong yuhui negotiated repeatedly and finally decided to transfer 100% of yuhui tongxing's shares to dong yuhui.

according to yu minhong's idea, after the independence of yuhuixingxing, the external pressure on the two companies will be reduced a lot, and the environment will be cleaner. however, judging from the aforementioned statement that "dongfangxuan maliciously attacked dong yuhui and yuhuixingxing", various discussions about dongfangxuan and dong yuhui will continue in the short term.

apart from public opinion, what yu minhong needs to think about more is how dongfang zhenxuan will proceed in the future without dong yuhui, the anchor. on august 23, dongfang zhenxuan released its annual performance announcement ending may 31, 2024.the financial report shows that in fiscal year 2024, oriental selection achieved a total revenue of 7.1 billion yuan, an increase of 56.8% compared with the same period last year.

the significant growth in revenue of oriental selection is inseparable from the good performance of its self-operated products and live e-commerce divisions. in fiscal year 2024, the total revenue of oriental selection's continuing operations came from its self-operated products and live e-commerce divisions, and the revenue contributed by this segment to the company increased by 68.1% from 3.9 billion yuan in fiscal year 2023 to 6.5 billion yuan in fiscal year 2024.

in fiscal year 2024, oriental selection also maintained a good level of net profit, with an adjusted net profit of 2.2 billion yuan from continuing operations and discontinued operations, compared with 1.1 billion yuan in fiscal year 2023. however, further analysis shows that oriental selection's net profit in fiscal year 2024 included 1.3 billion yuan in after-tax disposal gains from the sale of education business. if we only look at the adjusted net profit of continuing operations, oriental selection's profit indicator for this item has decreased by more than 20% year-on-year to 710 million yuan.

in fiscal year 2024, the number of followers of oriental selection on the douyin platform increased from 41.8 million in the previous fiscal year to 65 million, but this includes the number of followers of yu hui xing tong on douyin. if the number of fans of yu hui xing tong, which has more than 20 million, is deducted, the growth of the number of followers of oriental selection on the douyin platform will no longer be so impressive.

in fiscal year 2024, dongfang zhenxuan's gmv increased by 43% year-on-year to rmb 14.3 billion. among them, the gmv from douyin accounted for the majority of dongfang zhenxuan's gmv, and the gmv from the application accounted for 8.4% of dongfang zhenxuan's total gmv. in fiscal year 2024, the total number of paid orders for third-party products and self-operated products on douyin increased from 136 million in fiscal year 2023 to 181 million.

although the gmv data of oriental selection seems to have achieved strong growth, it is very likely that this includes the gmv contributed by hui tongxing.however, oriental selection did not disclose the specific gmv data of huixing in its financial report.

referring to the impressive sales performance of yuhui tongxing cited by many media before, after oriental selection separates from yuhui tongxing in the future, oriental selection, which will lose dong yuhui, the top anchor, will undoubtedly face severe tests if it wants to maintain its strong growth in gmv.

yu minhong paid 358 million yuan as a "breakup fee" to dong yuhui by giving him the song "with hui"

after denying the remarks that it paid someone to discredit dong yuhui, dongfang zhenxuan responded positively to the remarks that "dong yuhui used the bonus money to buy back yuhui tongxing" and even that "he had to pay 6 million to buy the company."

oriental selection stated that yu minhong had clearly pointed out at the shareholders' meeting on july 26 that all the funds for dong yuhui's acquisition of huitongxing company had been arranged by new oriental education group in addition to dong yuhui's total reward.

how was the interest between dong yuhui and his former company oriental selection distributed? back in july this year, oriental selection and yu minhong announced to the outside world that dong yuhui had left oriental selection and would develop independently from it.

according to the announcement released by oriental selection at that time, after friendly discussions with the group, dong yuhui has decided to no longer serve as an employee of the company and a senior management of a merged affiliated entity of the company.

regarding dong yuhui's resignation, oriental selection explained in the announcement that it was due to dong yuhui's career ambitions, investment in his other careers and personal time arrangements, and it took effect on july 25.

in addition, according to the listing rules and the company's articles of association, yu minhong has made arrangements for the settlement price of dong yuhui's acquisition of yuhui tongxing. it is understood that the price of dongfang zhenxuan's sale of yuhui tongxing is 76.5855 million yuan.

however, yu minhong mentioned in his open letter that "yuhui holds the money needed to purchase the equity of yuhui, and i have arranged the payment in a manner consistent with the rules of listed companies and the company's articles of association." in order to eliminate misunderstandings from the outside world, yu minhong also made a clearer explanation of the meaning of the previous sentence, "i have arranged the money for yuhui to buy the company, and the company is a gift to yuhui."

at the same time, yu minhong also emphasized again that dongfang zhenxuan has not taken any of the income and profits obtained by yuhui tongxing since its establishment, and has left all of them to dong yuhui and yuhui tongxing to support their continued development. in order to ensure the normal operation of yuhui tongxing's business, dongfang zhenxuan, with the approval of the board of directors, will deliver the developed information system to yuhui tongxing for free.

in the annual performance announcement released on august 23, oriental selection further disclosed the specific details of the profits distributed to dong yuhui.the financial report shows that the unaudited net profit of huixingxing is about 141 million yuan, of which about 129 million yuan can be distributed to dong yuhui. according to applicable chinese laws, the difference of about 12 million yuan will be retained by the target company huixingxing.

at the oriental selection shareholder communication meeting held on july 26, yu minhong also revealed that the remaining 140 million yuan of net profit of huixingxing was the remaining 140 million yuan after 50% was distributed to dong yuhui as agreed. the money distributed to dong yuhui has been put into his personal account. according to the agreement, the remaining 141 million yuan of net profit should have belonged to oriental selection 100%, but under yu minhong's promotion, the remaining 141 million yuan will also be awarded to dong yuhui in full.

based on this calculation, the "breakup fee" paid by yu minhong for dong yuhui's "separation" totaled more than 358 million yuan. this "sky-high breakup fee" includes 141 million yuan already paid to dong yuhui, 141 million yuan of remaining profits awarded to dong yuhui, and 76.5855 million yuan of the acquisition of huitongxing "arranged" by yu minhong, and this does not include dong yuhui's half-year salary.

however, even though yu minhong gave dong yuhui a sky-high "breakup fee", it still did not completely dispel the outside world's doubts. some netizens believe that yu minhong has a big vision and achieved a "decent breakup". but some netizens believe that this is what dong yuhui deserves. dong yuhui has created so much profit for the company, and it is reasonable for him to get such a reward. in fact, dong yuhui's value is far more than this.

another voice believes that yu minhong's generous move needs to be paid for by the small and medium shareholders behind dongfang zhenxuan. some netizens and shareholders even said, "if yu minhong wants to do charity, he can pay out of his own pocket and transfer billions from his personal account to dong yuhui to acquire yuhui tongxing instead of taking the public assets of all shareholders and giving it to dong yuhui as a personal favor."

in response to external doubts, yu minhong said at a previous shareholders' meeting that dong yuhui has made great contributions to the development of oriental selection.when he is completely independent, we will give him a bonus to express goodwill and pass it on to society. when we were discussing the guaranteed income, we had a plan to increase equity. but when we discussed independence at the end of february, the increase in equity was meaningless. because listed companies distribute equity, if the work period is not completed, the equity will be taken back.

he also said, "since yuhui has continued to contribute to the company's development in the past six months, it is reasonable to provide some cash subsidies. we convey this goodwill to help yuhui's future development and also put a perfect end to yuhui's contribution to oriental selection for more than two years."

denying "cashing out 800 million at a high price", yu minhong has never sold his shares since the listing

in addition to the rumors mentioned above, there are even messages on the internet saying that dong yuhui raised the share price of oriental selection, but yu minhong cashed out 800 million yuan at the high price.

regarding the statement that "yu minhong cashed out 800 million yuan at a high price", oriental selection stated in a statement to refute the rumor that since oriental selection went public, yu minhong has never cashed out his stocks personally. instead, he has been increasing his holdings of oriental selection stocks and he is full of confidence in the company's long-term development.

tianyancha shows that the domestic operating entity of oriental selection, beijing new oriental xuncheng network technology co., ltd., was established in 2005 and has completed four rounds of financing.

on march 28, 2019, new oriental online, the predecessor of oriental selection, was listed on the hong kong stock exchange. at that time, the company's main business was not the current live e-commerce, but education. judging from the number of publicly disclosed shares and the proportion of shares held, as of now, yu minhong has indeed not cashed out by reducing his holdings in oriental selection.

according to data from eastmoney, when new oriental online went public, its parent company new oriental held 500 million shares of new oriental online, corresponding to a shareholding ratio of 54.71%; yu minhong himself held 30.5541 million shares of the company, corresponding to a shareholding ratio of 3.34%.

in march last year, the stock name of new oriental online was officially changed to oriental selection. as of november 30 last year, new oriental held 557 million shares of oriental selection, corresponding to a shareholding ratio of 54.89%.the number of equity shares that yu minhong holds in oriental selection is 51.3781 million shares, corresponding to a shareholding ratio of 5.06%.

although he did not sell off his shares in the company, yu minhong, as a senior executive of dongfang selection, has also received considerable compensation from the company in recent years. according to ifind of tonghuashun, from fiscal year 2019 to fiscal year 2023, yu minhong received compensation of rmb 21.243 million, rmb 23.567 million, rmb 11.172 million, rmb 10.875 million, and rmb 9.661 million respectively from dongfang selection. based on this calculation, yu minhong received rmb 76.518 million in salary in five years.

it is worth mentioning that sun dongxu, the former ceo of dongfang zhenxuan, who was also pushed to the forefront of public opinion due to the "small essay" storm, also received considerable compensation during his tenure as a company executive. according to ifind of tonghuashun, from fiscal year 2019 to fiscal year 2022, sun dongxu's compensation from dongfang zhenxuan was 10.651 million yuan, 13.895 million yuan, 10.14 million yuan, and 10.49 million yuan respectively. in fiscal year 2023, sun dongxu's compensation even exceeded yu minhong's, reaching 16.391 million yuan.

as of the end of november last year, sun dongxu held 14.982 million shares of oriental selection, corresponding to a 1.48% stake. as of the close of august 27, the latest market value of oriental selection was hk$12.272 billion.if calculated based on the current market value of oriental selection, the equity held by sun dongxu is worth hk$182 million.

in april last year, oriental selection also issued an announcement to grant stock awards to several eligible participants (i.e. grantees). among them, yu minhong, then non-executive director and chairman, was awarded 1.5 million shares, sun dongxu, then executive director and ceo, was awarded 3 million shares, and the remaining 151 employees received a total of 25.359 million shares as incentives. calculated based on the closing price on april 11 of that year, the value of the shares awarded to yu minhong and sun dongxu was hk$43.5 million and hk$87 million, respectively.

some analysts pointed out that the "breakup" between dongfang zhenxuan and dong yuhui has basically been settled, but the public opinion and market reaction surrounding it are still fermenting. for dongfang zhenxuan, how to effectively manage the external public opinion environment while maintaining stable growth in performance is still an issue that needs to be focused on in future development.