NVC Lighting chief Wu Changjiang fights dismissal as board row deepens
Wu Changjiang refuses to accept directors' move to oust him from lighting product maker
A boardroom tussle at NVC Lighting Holding, one of the mainland's largest lighting product makers, has deepened as chief executive Wu Changjiang digs in to fight his ouster from the post.
NVC had announced on August 8 that the board voted to dismiss Wu as chief executive and install Wang Donglei as interim chief executive. But in a filing to the stock exchange on Thursday night, NVC said Wu had refused to accept the board's vote.
In addition to acting to remove Wu, the board at the August 8 meeting dismissed three vice-presidents: Wu's brother Wu Changyong, Mu Yu and Wang Minghua.
The latest ructions in the boardroom have played out after disputes dating to 2012. Wu Changjiang had been appointed chief executive under a three-year contract in January last year, after stepping down as chairman and chief executive in May 2012 amid an acrimonious shareholders' row related to strikes at NVC's factories in Chongqing and Huizhou, in Guangdong, that year.
NVC said in its filing: "Mr Wu has unreasonably and without legal basis refused to comply with the board's resolution, and to relinquish his position as chief executive officer. Mr Wu's continuing actions are having an adverse effect on the company."
It said the board was "taking urgent steps to minimise the effect of his actions and to assume effective and full control of the company's operations as soon as possible".
Wang Donglei said yesterday that Wu was the only board member to vote against his dismissal. Wang played a tape recording purported to be of Wu saying: "I'm telling everybody, if the board pushes this resolution, I will not abide by it at all."
Wang said NVC was considering suing Wu in Hong Kong and on the mainland. Wu, who is based in Chongqing, remains in control of NVC's operations in the city, he added.
Production at NVC's factory in Wanzhou, Chongqing - one of NVC's four main production sites - had been suspended since August 8, the company said.
The Wanzhou factory accounted for 25 to 30 per cent of NVC's sales and its 2,000 workers had been put on leave, Wang said.
"This is because certain supporters who are believed to be affiliated with Mr Wu have unreasonably refused to hand over control of the Wanzhou factory to a person authorised by the board. The local government has been involved in attempts to mediate this dispute," the company said.
"To avoid possible misuse of the company's funds, NVC has notified banks to suspend all payment from the bank accounts of the Chongqing Wanzhou factory (except payment of salaries), all payments from the bank accounts of NVC's mainland subsidiary NVC Lighting (China), and all payments from certain bank accounts of another mainland subsidiary, Huizhou NVC Lighting Technology."
Production at NVC's three other factories - in Huizhou and in Zhejiang province and Shanghai - remained unaffected, Wang said.
Although some distributors were loyal to Wu in the past, Wang said, most of NVC's distributors had signed agreements that they would support the company's management.
NVC said it would hold an extraordinary meeting on August 29 in Hong Kong to remove Wu as director and from all posts in the company.
NVC's shares have been suspended since August 11.