SAIF-backed NVC Lighting hit by internal strife

Liu Shuanglong, general manager of NVC's Zhejiang subsidiary, resigned on August 16, becoming the third senior figure to quit in two days. The other departees were Fengyun Xu, vice president and COO for marketing and large projects, and Karel Robert den Daas, an independent director.

The problems can be traced back to the resignation of Changjiang Wu, NVC's CEO and chairman, in May, after investors accused him of making related-party transactions and claimed weak corporate governance under his management. Wu's supporters maintain that his departure is the result of plan put together by international investors to take control of the brand.

SAIF Partners committed $22 million to NVC in 2006 and is currently the second-largest inevstor. Two years later, it increased its holding, putting in $46.6 million through a joint investment with Goldman Sachs. Last year, Schneider Electric joined the club, acquiring a 9.2% stake in NVC. The three parties currently own 33.36% of the listed company.

Workers have been demanding the return of Wu, while distributors and suppliers have also reportedly cut connections with NVC.

Yan Yan, current NVC chairman and a partner at SAIF, said the private equity firm would not back down despite massive protests. "In the worst-case scenario, we go and find new distributors and the company stock will suffer for about two years," he said, cited by Chinese media Caixin in July.

On Wednesday, Yan told the Hong Kong Stock exchange that while some suppliers had indicated they will no longer work with NVC, certain plants - including those in Huizhou and Wanzhou - are still operating. NVC's stock rose as much as 7.48% in morning trading.

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• Topics
• Greater China
• Industrials
• China
• SAIF Partners
• Goldman Sachs