Head of biggest Chinese property firm sidelined
Wang Shi, who built China Vanke Co. into the country’s biggest developer after founding it 33 years ago, stepped down as chairman after an ownership tussle that ended with a state entity becoming its biggest investor.
The exit of the 66-year-old Wang comes after metro line builder Shenzhen Metro Group Co. emerged as a white knight last year and did a deal this month to boost its shareholding.
Statements from Vanke and its founder didn’t make it clear whether he was severing all ties.
“One key question is whether Wang Shi’s departure is clear cut or whether he will still play some role as a consultant or adviser,” said Kristy Hung of Bloomberg Intelligence.
The twist comes just as the nation’s biggest developer by market value is seemingly set for a new phase of stability after a tussle that Vanke said threatened projects, contracts and the firm’s credit profile. In 2016, Vanke ceded its top position for contracted sales to rival China Evergrande Group and it now sits behind Country Garden in 2017.
Unlike his counterparts at big Chinese rivals, Wang doesn’t have a controlling stake in the company. That left the field wide open for the raid in 2015 by Baoneng Group.
On WeChat, Wang, a high profile businessman with a big public following, said that he was handing “the baton” to the younger team of President Yu Liang, 52. Wang’s name was missing from a list of board nominees that included Yu.
“Wang has largely kept his hands off the firm’s day-to-day management since Yu Liang took the role of president, so it’s natural for him to abdicate in favor of executives actively involved,” said Danielle Wang, a China property analyst at DBS Vickers Hong Kong Ltd.
“But he will definitely remain as Vanke’s spiritual leader, like a consultant or think tank,” DBS’s Wang said. “I’m sure Yu Liang can still turn to him when he needs advice.”
Vanke’s share price in Hong Kong has fallen by 8 percent since Yu said in December 2015 that the company faced a hostile takeover from Baoneng, a slump that compares with gains of 139pc and 184pc for China Evergrande and Country Garden, respectively.
Wang, a veteran of the People’s Liberation Army, founded Vanke as a trading firm before it became a real estate juggernaut.
From December 2015, the company was embroiled in China’s most high-profile corporate battle, involving a tangled web of state-owned shareholders, competitors, and a hostile predator.