Hanergy Thin Film’s Chairman Li Resigns to Improve Governance

  • New chairman, CEO named, solar company shares still suspended
  • CEO Si is accountant and auditor working at Hanergy’s parent

Li Hejun, the man at the center of last year’s rise and fall of Hanergy Thin Film Power Group Ltd., stepped down as chairman and executive director in a boardroom shakeup designed to strengthen the way the company is governed.

The changes in the board of directors are a result of plans to improve company management and focus on other business development and they are normal, parent Hanergy Holding Group Ltd. said in a website statement on Saturday.

It’s been a year since Hanergy’s Hong Kong-listed shares were halted from trading after the stock collapsed in a half hour of trading, reducing the company’s market value by $19 billion and prompting an investigation by stock market regulators. The plunge made Hanergy an emblem of the froth in China’s stock markets that had made Li, for a time, the nation’s richest man.

Li, founder of Hanergy Holding, controls more than two-thirds of the stock of the listed subsidiary and remains as chairman and chief executive officer of the parent company, which has been investing in thin-film solar technology since 2009.

"I don’t think that will make much difference" to the regulators or stop the investigation, shareholder activist David Webb said by phone.

The Hong Kong’s Securities and Futures Commission didn’t reply to an e-mail seeking comment.

Serving as chairman of the listed company for two years before the resignation, Li is known for speaking with a vision of a world outfitted with solar cells atop everything from automobile to umbrellas. He built his fortune by securing private ownership of hydroelectric assets, including a power station a third larger than the Hoover Dam in the U.S.

Li had no disagreement with the board and isn’t quitting for reasons that need to be brought to the attention of regulators, Hanergy said in a statement to the Hong Kong stock exchange Friday. Yuan Yabin, 48, will replace him as chairman and executive director. He currently acts as deputy general director of the company’s parent.

The move is only a "small first step" before their shares could resume trading, said Charles Yonts, the CLSA Asia-Pacific Markets analyst in Hong Kong who raised questions about Hanergy’s accounting policies and its dependence on its parent company for the majority of sales in December of 2014.

Hanergy Thin Film has been communicating with Hong Kong’s securities regulator, though the company hasn’t been told when the investigation will be concluded or the shares may resume trading, the parent said in an email last week.

Yuan joined Hanergy’s parent company in 2013. He is president of Alta Devices, a unit of the company, and previously worked for the CPPCC National Committee.

Hanergy Thin Film also named Si Haijian, an executive director of the company since Dec. 21, as chief executive officer. Si is a certified internal auditor and public accountant in China and joined Hanergy Group in 2014.

Dai Frank Mingfang and Feng Dianbo, who are both deputy chairmen, also stepped down.

— With assistance by Reed Landberg, and Feifei Shen

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