Laerfu, the third oldest supermarket chain, changed its administration in October this year. The Guangquan Wang family withdrew from the management level and the original major shareholder, Federation (2838), took over the management rights. This sent a shock bomb to the retail channel. The outside world is also curious about the Wang family, which has been in business for 34 years. Why did the family withdraw at this time?
According to a friend of the Wang family, as early as two years ago, there was news in the investment circle that the major shareholder of Laierfu was going to sell its shares. The buyer asked if there was a consensus among the family, and then learned that selling Laierfu was the consensus of the Wang family. The reason was that it was difficult. The business was struggling and continued to suffer losses. In order to avoid endless capital increases without seeing any results, the Wang family unanimously agreed to sell out all 70% of their shares.
According to data from the Department of Commerce of the Ministry of Economic Affairs, it can be seen that Laerfu has increased and decreased capital many times, including capital increases in 2019, 2021 and 2022; in February 2022, its share capital was 974 million yuan, and it had reduced capital by the end of December of that year. to 396 million yuan.
Being pinched by supermarkets lined with American and Japanese businessmen
A senior retail executive pointed out that the Wang family struggled to survive being squeezed by supermarkets from the United States and Japan. They chose to open stores in factories that were rarely visited by the two major supermarkets, or even in blank areas such as supervision offices, and rushed out of the market as a pure Taiwanese company. Taking the third place, Lyle has annual revenue of 24 billion yuan and currently has 1,583 stores. FamilyMart, the second largest supermarket chain, has revenue of more than 90 billion yuan and more than 4,000 stores; the leading supermarket chain Uni-President Supermarket (2912) has more than 1,800 stores. Compared with 100 million and more than 6,800 people, there is already a long distance, and it will probably take a lot of effort to catch up.
Because the operation has not improved and continued to suffer losses, the operation plan has not seen results, so as to avoid endless capital increases, Laerfu has become an irrecoverable money pit. As the operation has become more difficult this year, the Wang family decided to stop the bleeding and sell it.
However, what few people know is that Uni-President Group holds 31.25% of the Wang family’s Guangquan Ranch, and Uni-President Chairman Luo Zhixian is one of the directors. Guangquan Ranch is now the third largest dairy company in Taiwan, and its profits are good every year. In the future, Wang’s business will have the opportunity to take the food industry to a higher level without the retail business.
The withdrawal from the business was subject to the unanimous consent of the Wang family
At the end of October this year, two or three members of the fourth generation of the family completely quit. There are rumors that the Wang family sold their shares due to internal strife, but they sold all the shares for such a concentrated amount of 70%. Friends of the Wang family denied this rumor and said that there was no internal strife in the family. The main reason was the fierce competition in the circulation industry and the great changes in operations. , due to the continuous losses in recent years and the need to inject capital, there was an internal discussion to stop losses if profits could not be made. The unanimous agreement of the Wang family also shows that shareholders are under great pressure to invest in loss-making businesses every year.
Back on Friday, October 13 this year, Laerfu Chairman Wang Yixiang and General Manager Wang Yufeng, as well as 50 to 60 important senior managers, held a meeting in the large conference room. In addition to thanking the team for their contribution, they also emphasized that the federal agreement would protect Laerfu Colleagues’ work rights and work rights.
Wang Yixiang said that because Laerfu has been losing money for many years, shareholders have different ideas about multiple capital increases. He thanks the Finance Department for its efforts to obtain bank credit lines. As chairman, he has to help Laerfu find better exits. Federal Group has Groups in the land construction and banking industries believe that they will be willing to provide financial injections for future investments in logistics and other industries.
Wang Yufeng said that his biggest regret during his tenure was that infrastructure investment was not completed. However, the retail industry needs to invest in a large amount of infrastructure such as logistics warehouses and fresh food factories. He was unable to obtain resources from shareholders. His emotional expectation was that although Laerfu changed bosses, Encourage the team to make Laerfu a success.
Commonwealth Bank Chairman Lim Hong Lian expressed confidence
October 16 is the equity delivery day, and an extraordinary shareholders’ meeting was held on that day for re-election. On October 17, Commonwealth Bank Chairman Lin Honglian went to the Laerfu headquarters to convene a cadre meeting and released two remarks.
First of all, he thanked the Wang family for their willingness to sell their equity. Although the Commonwealth had no experience in retail business and was under pressure to take over, he first shared that Taiwan opened applications for new banks in 1991, and Commonwealth Bank also applied. At that time, the shareholders were not from banks, but they believed As long as you work hard and solve the difficulties one by one, you will definitely succeed.
Lin Honglian also specifically mentioned that employees must have integrity and ethics. He mentioned the collusion case of fraud syndicates that broke out at the Commonwealth Bank a while ago. He also mentioned that a colleague in the procurement department of the Commonwealth Group purchased a batch of tiles. The contractor asked if he would like to help the purchasing staff use the remaining tiles for decoration at home. , but such gray area practices are not allowed, which highlights that Lin Honglian attaches great importance to ethics.
Du/The Guangquan Wang family has withdrawn from business after 34 years, and it is actually the family consensus that Laerfu sells 70% of its shares
Laerfu, the third oldest supermarket chain, changed its administration in October this year. The Guangquan Wang family withdrew from the management level, and the former major shareholder Federation (2838) took over the management rights, which sent a shock bomb to the retail channel. The outside world…
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