GREE'S Shareholders' Meeting Directly On The "Mixed Change Sensitive Period": The Amendment Of The Charter Is Not Related To The Change Of Mobile Phone Business.

Song Wenhui diagram

In November 18th, the second annual general meeting of GREE electric appliances was formally held in 2019.

To the astonishment of 7 Dong Jiangao, the two provisional shareholders' meeting attracted more than 100 shareholders. The huge conference room is packed. Among them, there are many investors who carry large suitcases and shoulder bags from all corners of the country.

A week ago, GREE electric first broke the market, with 3 billion subsidies to break into the double eleven "electricity supplier fierce battle", and later announced plans for nearly half a year of mixed change plan postponed, high Ling and GREE group's share transfer agreement postponed signing. These two events are beyond the expectations of investors.

"GREE's performance in the first three quarters is actually very good, but the company chose to make a huge subsidy to seize the market at this time. It is a little radical and unable to understand. In fact, the company that can expand the online channel can move forward steadily. In addition, why do we postpone the transfer agreement with high allocations? We also hope to understand. A private equity investor in Southern China said on the spot.

However, at the shareholders' meeting, 7 Dong Jiangao coincidentally mixed up and changed their words. Even at the beginning of the meeting, because of the "sensitive" period, the company did not arrange the communication link between shareholders and senior executives. Dong Mingzhu, chairman of GREE electric appliances, was absent again after the annual general meeting.

Until the shareholders of the field vote on the bill, Wang Jingdong, deputy general manager, said that because of the number of shareholders on the spot exceeded expectations, in order to thank shareholders for the company's concern, management can be "non sensitive issues" and shareholders to communicate. As soon as the voice dropped, the audience applauded.

No amendment to the charter amendment

According to the information released by Wang Jingdong, the total number of shareholders attending the meeting was 114. 706 shareholders were voted on the spot and online, representing 2 billion 557 million shares, accounting for 42.51% of the total number of voting shares of the listed company.

The meeting passed the motion on Amending the articles of association and the motion to amend the rules of procedure of the shareholders' meeting, which approved all the two bills.

Despite the details and progress of management and avoidance, it still can not resist the high degree of concern of shareholders. At the scene's first question, we try to excavate the clues of the change of company's control rights.

In twenty-first Century, the economic news reporter noted that two of the contents of the revised motion were widely concerned by the market. The first was to delete the decision of "holding a position other than a director in a real control unit and not serving as senior management of the company".

Some shareholders questioned that the move or paving the way for high allocating capital means that Future Ltd's new real controller (Gao Ling capital) can send employees to GREE electric management.

But in view of this controversy, Wang Jingdong denied it.

He replied, "(the revised plan) has nothing to do with the transfer of shares, which is the corresponding amendment made by the company in accordance with the contents of the SFC's guidelines on the articles of association of the listed companies (revised in 2019)."

Another detail about the bill is GREE Electric's smart phone business.

In the revised articles of association, GREE Electric has deleted the business scope of "e-commerce: e-commerce planning and implementation, providing e-commerce platform network development and maintenance. To operate telecommunications and value-added telecommunications services, information transmission, software and information technology services "and other businesses.

Some market participants pointed out that GREE electric or to abandon the mobile phone business.

But this statement was also denied by Wang Jingdong. Wang Jingdong said, "you may also be concerned about the eligibility of GREE (mobile phone related), and the mobile phone business will not be placed in the headquarters or parent company, but will be applied to the subsidiary. Not all businesses are put into the parent company, which has nothing to do with the company's mobile phone related business layout.

What needs to be added is that by the end of October, GREE Electric's folding screen mobile phone patent has just passed the patent authentication. However, Wang Jingdong also frankly pointed out that the distance from patents to products is still very far away, and is still in the research stage. But on mobile phones, 5G is officially commercial this year, and the company wants to make preparations at a new starting point.

Subsidy pressure will not be passed on to dealers.

In addition to the relevant contents of the motion, GREE Electric's double eleven subsidy is also the focus of the shareholders' meeting.

On the eve of double eleven, GREE electric announced micro-blog, WeChat and other channels in the "micro-blog", "3 billion yuan" subsidies to promote sales, but also double eleven activities before (from January 1, 2019 to November 10th) bought "Jun Yue" "T Shuang" series of consumers, subsidies.

This "disguised price cut" immediately triggered a great uproar in the market, and even reduced the dimension of the two or three line brand. On the day of double eleven, the sales volume of GREE electrical appliances on the whole category exceeded 4 billion 400 million yuan, an increase of 200% compared with the same period last year. The third party platform of GREE air conditioner broke through 3 billion 640 million yuan a day, and sales increased by 178% over the same period. The sales of Dong Mingzhu's store broke through 363 million yuan a day, and sales increased by 48 times over the same period last year.

Western securities appliance industry analyst Luo Yamei pointed out that off-season promotion activities are conducive to channel inventory and reduce channel pressure. At the same time, the inventory of low-end models occupy a relatively high level, to lower the low end inventory is conducive to manufacturers to accept new energy efficiency standards. At the same time, the promotion of promotional activities is conducive to the improvement of GREE market share.

However, behind the "letting profits", huge subsidies also make investors worried about the performance pressure that GREE Electric will soon face and the future price war. In November 11th, GREE Electric shares fell 3.84%.

"The sudden implementation of the price reduction strategy by GREE is beyond our expectation. Without any omen, the predictability of management is not so strong compared to that of the United States." The investors said.

In fact, on the day of the general meeting of shareholders, Wang Jingdong also used "surprise" to describe the subsidy activities.

Wang Jingdong said: "our double eleven launch promotion model, played a drainage role to the company's e-commerce business, but also raised the concern of GREE brand. Besides, non promotional models also sell well, accounting for a larger proportion of electricity providers. There is no influence on gross margin, but it is within the controllable range. We have to see the long-term results, this unexpected sword, pulling the brand and flow, and strengthening the interaction between online and offline.

It is worth mentioning that in this price promotions, the market has been worried that this action or damage the interests of GREE dealers, Wang Jingdong responded that subsidies will be borne by GREE appliances, will not let the dealer bear.

In fact, in the shareholders' meeting, Wang Jingdong has been emphasizing that Future Ltd will integrate online and offline, but it will also protect the interests of dealers.

In November 5th, GREE electronics established GREE Agel Ecommerce Ltd with a registered capital of 100 million yuan and wholly owned by GREE electric appliances. Dong Mingzhu is the company's legal representative and chairman of the board.

Wang Jingdong pointed out that "the establishment of an electricity supplier subsidiary, the electricity supplier plate at the subsidiary level, more convenient for the operation of the electronic platform, the system is relatively independent, and the operation efficiency will be higher; dealers under the line are also part of GREE's entire value chain, all to facilitate the service of consumers, we will guarantee their interests."