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Troubled lighting maker NVC hit by production woes

Factories of lighting maker in midst of management turmoil face problems getting raw materials

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Toh Han Shih

Troubles continue to plague NVC Lighting Holding, the Hong Kong-listed firm that issued an announcement on Tuesday listing a host of problems including resignations and disputes with its former chairman Wu Changjiang.

Some of the lighting maker's factories may halt production at some point because of a lack of supplies, an unnamed NVC employee told the South China Morning Post.

Wu, however, said NVC's production had already partially halted because of supply problems, the news portal Sina.com reported. One supplier of raw materials to NVC, Chang Xin Hardware, is owned and operated by Wu's cousin Yin Yan, according to NVC's IPO prospectus.
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NVC admitted the current inventory of its factories in Chongqing and Huizhou city, Guangdong province, is enough for only a few days of production. Although a two-week strike at the Chongqing and Huizhou factories ended on July 27, NVC "cannot rule out the possibility that the employees of the Huizhou plant may resume striking if they do not receive satisfactory responses to their requests", the company said.

NVC vice-president Xu Fengyun tendered his resignation on Tuesday and a general manager, Liu Shuanglong, submitted his resignation two days later, Caixin online reported. More senior executives were expected to resign in the next few days, the Caixin report said.

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Wu, who founded and owns 38 per cent of NVC, has alleged that the Securities and Futures Commission was investigating unnamed persons manipulating NVC's stock around May 24, when Wu resigned as chairman and chief executive, Sina.com reported. Wu denied an earlier report that named NVC's current chairman Andrew Yan as the subject of SFC's investigations. NVC has formed a team to investigate Wu, the company announced on Tuesday. The team found that Wu, when he was chief executive, approved the transfer of the chief executive's office and other headquarters offices to Chongqing without NVC's approval.
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