Executives at Chinese Appliance Makers Sell Off Shares After Midea Founder’s USD160 Million Cash-Out

Li Juan, Wang Zhen / Yicai

2017-05-18

(Yicai Global) May 18 -- After Midea Group [SHE:000333] founder He Xiangjian unexpectedly dumped 32 million shares in his company to cash out CNY1.1 billion (USD160 million), executives at two more listed appliance makers have cut their holdings.

Some 12 senior managers at Hangzhou Robam Appliances Co. [SHE:002508], including its actual controller Ren Jianhua, sold off a total of more than 2.8 million shares on May 15, cashing out nearly CNY108 million (USD15.6 million). On May 16, Zhang Songnian, chairman, ditched a further 123,500 shares.

Wang Gang, Robam’s secretary to the board, told Yicai Global that the selloff came just as restrictions were lifted on the sale of initial shares. It’s unlikely they will further cut shares this year, he added.

Also on May 16, Su Xianze, director of Zhejiang Supor Co. [SHE:002032], another Chinese appliance maker, sold off 10,000 shares in the company.

Robam’s value has been rather impressive since its price-earnings ratio increased more than 30 times, insiders told Yicai Global. Regulations governing the real estate industry could hold back future growth and development of the company, they added. A source from an investment confirmed the PE ratio and added that the firm’s price-book ratio had also multiplied eight-fold, indicating an excessively high valuation. It’s not unexpected that the senior members would sell off shares at such a point, he added.

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