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in the a-share market, a dramatic shareholders' meeting has made colin electric (603050.sh, share price 24.51 yuan, market value 6.679 billion yuan) the focus of the capital market in recent times.

on august 31, as night fell, the two-day first extraordinary shareholders' meeting of colin electric in 2024 finally came to an end. the men in black "blocked the door", the board candidates were blocked from entering, and the top leader of the state-owned shareholder left early. the plots of the movie script were played out one after another, which made people curious about the outcome of this power struggle.

in fact, after several months of "fierce fighting", colin electric's shareholders' meeting was not only a routine meeting for the election of the board of directors and the board of supervisors, but also a fierce battle for control of the company.

after months of fighting in the air, the two major shareholders, qingdao hisense network energy co., ltd. (hereinafter referred to as "hisense network energy") and shijiazhuang state-owned capital investment and operation group co., ltd. (hereinafter referred to as "shijiazhuang state-owned capital investment and operation group"), finally launched a head-on confrontation at the shareholders' meeting.

image source: photo by peng fei, reporter of china business network

this fight has also had an impact on colin electric's performance. the company's 2024 semi-annual report shows that although the net profit attributable to shareholders increased by 27.38% year-on-year, the growth rate in the second quarter has slowed significantly compared with the growth rate in the first quarter.

as a result, this shareholders' meeting not only attracted the attention of the capital market, but also became a hot topic for the media. as the only media reporter who had attended the annual shareholders' meeting of colin electric as a shareholder, the reporter of the daily economic news once again went to the venue as a shareholder from august 30 to 31 to witness this shareholders' meeting that set a record for the longest time in the a-share market.

after breaking the previous record of the length of the a-share shareholders' meeting in the first half, the parties involved in the meeting, who only rested for a few hours, welcomed the dawn of reconciliation on august 31: hisense proposed "discussion" and "communication", and the company's founder zhang chengsuo also called for "calmly discussing solutions." finally, at the end of the meeting, the newly elected directors nominated by shijiazhuang guotou proposed "joint development" and called for an end to the meaningless fighting.

however, does this mean that the battle for control of colin electric is about to come to an end? the market is waiting to see.

men in black guard the gate hisense network encountered obstacles when nominating directors for admission

with the announcement of the 4:3 result of the election of directors of the new board of directors, hisense network energy and shijiazhuang state investment, the record-breaking first extraordinary shareholders' meeting of colin electric in 2024 came to an end. however, the identities of the more than 10 men in black who appeared at the entrance of the venue remain an unsolved mystery.

on the afternoon of august 30, after months of "fighting in the air", hisense network and shijiazhuang state investment finally had an offline confrontation. on this day, the fourth board of directors of colin electric, which has been in service for nearly a year, will have a formal vote to change terms and decide who will take the initiative in the new board of directors.

because of the importance of the meeting, all parties were impatient. at 8:30 and 9:52 a.m. on august 30, reporters from the national business daily received text messages from hisense network and shijiazhuang state investment group to solicit votes. although the meeting was scheduled to start at 14:00 that day, a staff member who accompanied the reporter to the venue said that some shareholders had registered to enter at 12:40.

at about 13:00, when the reporter registered, staff from hisense network energy, one of the shareholders vying for control of kelin electric, also registered at the door of kelin electric. the reporter later learned that, for safety reasons, hisense network energy planned to complete the entry before 13:30 that morning.

image source: photo by peng fei, reporter of china business network

unlike when the reporter attended the 2023 annual shareholders meeting of colin electric in early may, the venue was filled with a tense atmosphere this time. from registration at the door to entering the venue, identity information was checked at least three times. in addition, the more than 10 men in black at the door of the venue did not even recognize qu guowang, the then president of colin electric, and qiu shiyong, the then chairman of the supervisory board, and they were also asked to verify their identities.

reporters noted that although the purpose was to maintain order, the appearance of men in black caused a certain degree of chaos in the venue during the meeting from 13:10 to 14:00.

"who are you? colin's employees at least have an identification, but you can't provide anything, why are you here?" "i am at least a shareholder, but what are you? why are you stopping me?" a shareholder raised questions when arguing with the man in black.

the reporter also tried to ask the black-clad personnel for their identities, but they refused to tell him and only asked him to lock all electronic products, including mobile phones and smart watches, in the locker at the door.

at around 13:50 on august 30, chen weiqiang, the non-independent director candidate nominated by hisense webnext, was directly blocked by men in black when entering the venue because his name did not appear on the list prepared by the company's securities department. the two sides had verbal and even physical conflicts over the issue of entry.

a man in black asked a representative from hisense network energy: "who are you?" another hisense network energy staff member questioned: "the director candidate wants to come in, and you won't let him in?" during the scuffle, a hisense representative even sat on the ground.

after consultation with colin electric staff, chen weiqiang entered the meeting room just as the meeting was about to begin. however, compared with the twists and turns when hisense entered the venue, the reporter saw that the non-independent director candidate mi yong and non-employee supervisor candidate zhang guibo nominated by shijiazhuang guotou had already taken their seats at the venue.

in the opinion of an institutional person who came all the way from beijing to shijiazhuang to attend the shareholders' meeting, the atmosphere of this shareholders' meeting of colin electric seemed particularly tense. the reason is that the two major shareholder camps have been fighting for control of the company for a long time, either openly or covertly.

"i just wanted to witness that the two sides have been fighting for so long, and this time there should be a result," said the person from the above-mentioned organization. but he did not expect that this witnessing would be so long.

i've never seen such a thing before! a new record for the longest shareholder meeting in the a-share market

after the "challenge" episode at the entrance, the shareholders' meeting started around 14:10 on august 30. although all parties expected that the meeting would be long, this "marathon" shareholders' meeting still caught all the participants, including the "men in black", by surprise.

"how many hours did you sleep?" "i'm so sleepy." at 10 a.m. on august 31, the "men in black" who had maintained order at the scene the day before appeared at the venue again. according to the original plan, they were supposed to maintain order at a concert in zhengding, hebei province that day, but the record-breaking shareholders' meeting of colin electric ruined their plan to "watch" the concert.

just over 7 hours ago, at 2:30 a.m. on august 31, the first half of the shareholders' meeting of colin electric ended after lasting 12 and a half hours. even if it was only the first half, it had already broken the record for the length of the a-share shareholders' meeting.

image source: photo by peng fei, reporter of china business network

"(on august 30) the announcement was not made until very late, and many people were watching." "this also set a record in china's capital market. it is also difficult for regulators to (quickly come up with guidance)." at around 9:30 am on august 31, when a reporter from the "daily economic news" once again came to colin electric on the nanjiangbi section of hongqi street, luquan district, shijiazhuang city, a staff member of colin electric who stayed until 2:30 in the morning of august 31 said this.

the first phase of the meeting lasted about 12 and a half hours from 14:00 on august 30 to around 2:30 a.m. on august 31. afterwards, the host announced a temporary recess, and the meeting resumed at 11:00 on august 31 and continued until the evening of the same day.

the reporter of daily economic news found that before this, the record of the length of the a-share shareholders' meeting appeared in 2018. on december 25, 2018, tibet development (sz000752) held a shareholders' meeting that was jokingly called "the longest in the history of a-shares", which started at 2 pm that day and ended in the early morning.

looking back at the shareholders' meeting, the meeting was chaired by zhang chengsuo, founder of colin electric and chairman of the fourth board of directors. more than 20 representatives attended the meeting, including mi yong, wang yong, li qian, chen weiqiang, shi wenbo and others nominated by the new board of directors.

after the meeting started on the afternoon of august 30, the securities affairs representative of colin electric read out the three proposals on the election of the board of directors and the board of supervisors to be discussed at the shareholders' meeting, as well as the resumes of the relevant candidates.

afterwards, the meeting entered the voting phase for shareholders and shareholder representatives to vote on various proposals. at around 16:00, as staff members carried ballot boxes around the venue to collect ballots, the venue began counting and monitoring votes.

the reporter of daily economic news saw at the scene that perhaps due to the lack of trust between the two parties, after the voting was over, the representative of hisense network proposed that both major shareholders should elect representatives to monitor the voting. after consultation, the meeting adopted this suggestion.

as the on-site voting ended, shijiazhuang guotou chairman mi yong (also a non-independent director candidate) stood up and left at around 16:00.

before mi yong left the meeting, hisense group holdings co., ltd. senior vice president chen weiqiang (also a candidate for director) reminded him to discuss the new board meeting after the voting results came out. mi yong replied, "respect the voting results." before leaving, chen weiqiang shook hands with mi yong and said goodbye.

hisense.com collects voting rights and uses them "accidentally". lawyer: it will not affect the election results

judging from the follow-up, mi yong’s departure might have been wise. at least he wouldn’t be hungry after staying at the venue until the early morning of the next day.

"it's a pity that after you left, the two sides had another argument, which was even more intense than (yesterday) afternoon." on the morning of august 31, when a reporter from the "daily economic news" once again arrived at the shareholders' meeting venue, a colin electric staff member (who was also a participating shareholder) said so.

the reporter learned that after collecting the ballots at 16:00 the previous day, in the presence of shareholder representatives, lawyers, etc., colin electric staff uploaded the on-site shareholder voting information to the exchange system one by one (a period of more than 4 hours). many hisense network staff watched the entire process behind the staff and occasionally pointed out omissions in the input.

however, compared with the tediousness of on-site voting and counting, the above-mentioned staff revealed that after the listed company uploaded the on-site voting results to the exchange system, the exchange gave feedback more than 20 minutes later, "the voting rights collected by hisense are inconsistent online and offline."

reporters from the daily economic news learned from multiple sources that the non-independent director voting rights publicly solicited by hisense web energy were actually cast for two candidates, chen weiqiang and shi wenbo. however, the witnessing lawyer believed that the authorization scope of some shareholders was to vote for the three candidates, chen weiqiang, shi wenbo and wu xiangsong, and some of the votes authorized by hisense web energy were inconsistent with the authorization scope.

on august 23, shijiazhuang guotou and hisense network energy both issued announcements through their listed companies, soliciting voting rights from all shareholders of the company except the solicitors between august 22 and august 28.

according to the data released by colin electric staff at the shareholders' meeting, hisense network has collected voting rights from 42 small and medium shareholders, involving about 1.16 million shares; while shijiazhuang guotou has collected voting rights from 4 people, involving about 187,100 shares.

in this regard, after the shareholders' meeting resumed on august 31, a person in charge of hisense network energy told the reporter of "daily economic news" that there was no conflict between the scope of authorization and the actual voting. "our operations are legal and compliant, but if the witnessing lawyer does not sign, the meeting cannot issue a final resolution. because there are indeed no specific regulations and cases to learn from, we can only wait for off-site guidance from the regulatory authorities."

from a follow-up perspective, because it happened to be saturday, the outside world inevitably speculated on the final voting result of the control of colin electric and whether the two major shareholders were still confronting each other during the period of waiting for regulatory guidance.

in the view of a capital market insider who is familiar with the battle for control of colin electric, hisense network's voting strategy is correct. although it nominated three non-independent director candidates, it only chose two at the time of voting, which obviously increases its chances of winning.

however, even if hisense.com could encounter an "accident" in the use of voting rights, it would not have a substantial impact on the final result that hisense.com could win 4 out of 7 seats.

on the morning of august 31, before the start of the "second half" of the shareholders' meeting, people including local shareholders in shijiazhuang and staff of listed companies told the reporter of "daily economic news" that even if the collected voting rights were eliminated, it would not affect the proportion of hisense network energy and shijiazhuang guotou on the board of directors.

it is worth noting that on the evening of september 1, beijing deheng law firm mentioned in the legal opinion issued that hisense network energy's voting opinion on the first resolution of this shareholders' meeting was inconsistent with the voting opinions disclosed in the "announcement on the public solicitation of voting rights of shareholder qingdao hisense network energy co., ltd." and the "report on the public solicitation of voting rights of shareholder qingdao hisense network energy co., ltd.".

the firm's lawyers believe that if the authorized shareholders do not raise any objections to them, it will not affect the validity of qingdao hisense's exercise of voting rights on behalf of the authorized shareholders, and the validity of such voting opinions will ultimately not affect the election results involved in the relevant proposals.

the two major shareholder camps jointly "formed a cabinet" and the elected directors proposed that all parties "stop making trouble"

after two days of tug of war, the lengthy colin electric shareholders' meeting finally came to an end at around 7 p.m. on august 31.

unlike the previous five-month-long tug-of-war, on august 31, all parties seemed to be looking forward to the meeting ending as soon as possible.

"i hope that everyone can discuss solutions calmly." at 11 a.m. on august 31, after 12 and a half hours of extreme tension the day before, the shareholders' meeting resumed. zhang chengsuo, the host and founder of colin electric, opened his heart to all representatives at the opening.

on march 18 this year, colin electric issued an announcement stating that the company's vice chairman li yanru and director and general manager qu guowang plan to transfer their 3.19% of the total share capital of the listed company to hisense network energy, and entrust the voting rights of the remaining shares (accounting for 9.57% of the total share capital) to hisense network energy.

at the same time, hisense network continued to increase its holdings in kelin electric through the secondary market, with the clear purpose of seeking control of the listed company. since then, the battle for control of kelin electric has officially begun.

after that, zhang chengsuo, who did not want to give up the company he founded, was always in a state of resistance against the "sneak attack" of hisense. after hisense network issued a bid to acquire 20% of the shares, zhang chengsuo and the then second largest shareholder shijiazhuang guotou and several senior executives reached a consensus, holding a 29.51% stake, vowing to work together to completely keep the "hisense" out.

however, compared with before, zhang chengsuo, hisense network energy, shijiazhuang guotou, and even the "men in black" outside the venue all eagerly hoped that this shareholders' meeting that broke the record for the longest duration of a-shares would end as soon as possible.

image source: photo by peng fei, reporter of china business network

"colin has suffered greatly in the past four months. (the management) is unable to work normally. there were many orders in the first quarter, but the second quarter has been affected." after the meeting resumed on august 31, zhang chengsuo told the shareholders present.

a reporter from "daily economic news" noticed that just one day before the shareholders' meeting, colin electric released its 2024 semi-annual report. although the company delivered a half-year report showing a 27.38% year-on-year increase in net profit attributable to shareholders, the growth rate has slowed significantly compared to the 65.05% growth in the first quarter since the battle for control began in march.

according to an employee of colin electric who wishes to remain anonymous, although the former chairman (zhang chengsuo) was reluctant to leave, he did not want the company to get into trouble because of the conflict, "after all, he was the one who founded the company."

zhang chengsuo's statement was also recognized by representatives of hisense network energy and shijiazhuang state investment. hisense network energy believes that under the off-site guidance of the regulatory authorities, all parties need to actively discuss and communicate. shijiazhuang state investment believes that the ultimate goal is the high-quality development of listed companies.

it is worth noting that on august 31, at the suggestion of hisense network energy, the preliminary results of the board of directors election the day before were also announced to the small and medium shareholders present for the first time. the reporter saw at the scene that according to the feedback from the exchange, in the vote on non-independent directors on august 30, mi yong and wang yong nominated by shijiazhuang state investment, and chen weiqiang and shi wenbo nominated by hisense network energy, all received a high vote rate. in terms of independent directors, the two candidates nominated by hisense network energy and one candidate nominated by shijiazhuang state investment are in the lead.

at 5 p.m. on september 1, colin electric officially issued an announcement on the resolution of the shareholders' meeting. the number of voting shares held by the shareholders attending the meeting accounted for as much as 90.0458% of the total number of voting shares of the company. hisense and shijiazhuang state-owned assets formed a 4:3 structure in the new board of directors of colin electric.

according to the announcement of colin electric on september 2, the company held the first meeting of the fifth board of directors on the same day, and elected chen weiqiang as the chairman of the fifth board of directors of the company, and elected shi wenbo as the vice chairman of the fifth board of directors of the company. nominated by chairman chen weiqiang, the board of directors appointed wang yong as the general manager of the company.

in the view of many people in the capital market, after months of fighting, the joint "cabinet" of hisense and shijiazhuang state-owned assets should be the best outcome. as for whether there will be a private placement in the future, it depends on how the parties negotiate.

it is worth noting that the above-mentioned colin electric person who did not want to be named told the reporter of "daily economic news" that as the only "old man" of colin electric who remained on the new board of directors, wang yong also proposed in his speech that "everyone should work together for development and stop bothering about other things."

hisense told the reporter of "daily economic news" that hisense will cooperate with all parties to jointly plan the development of listed companies, take maximizing the interests of all shareholders as the greatest attitude and greatest motivation, and work together to make colin electric bigger and stronger.