SoftBank wins key corporate battle in China by ousting defiant CEO from Arm joint venture

SoftBank Group Corp is on track to win a key corporate battle by ousting a defiant chief executive from a Chinese joint venture of British chip designer Arm, in a two-year drama that has ended with the apparent help of the Chinese government.

Arm China has registered Liu Renchen – a member of Shenzhen’s political advisory committee and a deputy dean at the Research Institute of Tsinghua University in the southern city – as its new legal representative, replacing incumbent CEO Allen Wu, according to a company statement published on Thursday on Chinese social media platform Weibo.

The registration was filed with the Shenzhen market regulator on April 28, Arm China said.

Eric Chen, a managing partner at SoftBank Vision Fund who has been leading the Japanese conglomerate’s negotiations with the Chinese government, has been named co-CEO of Arm China, along with Liu. Arm China’s Weibo account is now the entity’s “sole official channel” for corporate news, overriding all other channels that may still be controlled by Wu, according to the statement.

Shenzhen’s decision to change the corporate registry, issue a new licence, and grant a new company chop is a sign that Wu, who had maintained de facto control of Arm China after he challenged a boardroom decision to oust him in June 2020, has lost the legal grounds and political blessing to remain in his seat, according to experts.