Chief Of China Retail Giant Quits After Gov't Led Bailout Of Firm

Zhang Jindong has stepped down as the chairman of Chinese retail giant Suning.Com Co. after losing control of his firm following a government-led bailout, Blake Schmidt reported for Bloomberg News.

The company announced his resignation in a filing with the Shenzhen stock exchange on Monday, adding that Zhang will be appointed honorary chairman to guide the firm’s future growth. Zhang, 58, lost control of Suning when the business sold a 16.96% stake to a state-backed consortium for a $1.36 billion bailout last week.

The group of investors, led by the Nanjing state asset-management committee and the Jiangsu provincial government, also includes Alibaba Group Holding Ltd. and Chinese appliance makers Midea Group Co. and Haier Group Co., smartphone maker Xiaomi Corp., and TCL Technology Group Corp.

The bailout and Zhang’s resignation precipitated the end of his reign during which he led the company into an array of businesses, including ownership of the Inter Milan soccer team.

Suning.com had a market value of about 52 billion yuan ($8 billion) before the trading halt. The retail business was weakened by a slowdown in spending during the pandemic. Concerns about its cash flow intensified in September, when Zhang waived his right to a 20 billion yuan payment from property developer China Evergrande Group.

The stock tumbled last month after a Beijing court froze 3 billion yuan worth of shares held by Zhang -- representing 5.8% of Suning.com -- and creditors agreed to extend a bond for Suning Appliance Group Co., which is owned by Zhang and fellow co-founder Bu Yang.

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