Secondly, this reduction is the need for Lin Bin's personal use of funds, including charity; thirdly, Lin Bin will not reduce his holdings in the short term and voluntarily make a 12-month commitment. Fourth, this reduction Compared with Lin Bin personally, the total number of shares held is very small, accounting for only 1.48% of his own equity.
Before Lin Bin,MilletGroup Chairman and CEO Lei Jun’s personal huge equity incentives also sparked controversy. Xiaomi's 2018 annual report revealed that Xiaomi's total annual salary was about 17.11 billion yuan. The total remuneration of the top five highest paid employees reached 10.21 billion yuan, accounting for nearly 60% of the total salary. Among them, Lei Jun’s salary (actually equity incentive) was approximately 9.87 billion yuan. This fund was approved by the board of directors and the shareholders meeting before the listing of Xiaomi.
In April 2018, Xiaomi Group issued approximately 64 million shares of Class B common stock to Smarshifshifent Mobile Holding Limited controlled by Lei Jun as equity incentives, accounting for approximately 2% of the total share capital, representing approximately RMB 9.9 billion at current valuation.
Later, the public and the media questioned the huge rewards. On April 10, 2019, Xiaomi Company responded that in addition to the one-time share incentives granted before the listing, Xiaomi did not issue any cash remuneration to Lei Jun in 2018. And the above-mentioned related shares spurred Lei Jun also promised to deduct all taxes payable and donate all for charitable purposes.
Some insiders told the First Financial Reporter that such actions by Lei Jun are not unusual in the industry, for exampleJingdongListed Liu Qiangdong received 4% incentives, and when Mali went public, Ma Yun took about 2%.
In 2014, before Alibaba went public in the US, Alibaba Group founders Ma Yun and Cai Chongxin jointly announced that they would set up a personal charitable trust fund from the Alibaba Group's options. The overall size is the upcoming Alibaba Group. 2% of the total share capital. Ma Yun said that the fund will focus on the environment, medical care,educationAnd the field of culture. On the eve of the listing of Jingdong in the same year, the board of directors awarded 4% of the company's equity to Liu Qiangdong, with a value of about 606 million US dollars.
It is not uncommon for a listed company to reduce its holdings at a high level. Wind data shows that in 2018, there were about 968 listed companies in the Shanghai and Shenzhen stock exchanges, including Dong Jiangao, which reduced their holdings by about 1/4 of the listed companies. The amount of reduction was 48.6 billion yuan, and the average holding of each executive was 50 million yuan. Typical example is “Cash King” Gong Hongjia in the first quarter of 2019, reductionHikvision130 million shares, cashed out 4.87 billion yuan. Since the listing of Hikvision, Gong Hongjia has a total amount of 14.62 billion yuan.
Lei Jun once claimed that the slogan of doubling investors and the market value of the group can reach hundreds of billions of dollars is still in the ear, but now has to face the embarrassment of high-level reduction. In addition to Lin Bin’s personal actions as a president to reduce his shareholdings in large numbers, Xiaomi’s continued low stock price is also the focus of Internet users’ discussions, including the announcement of the second quarter and first half of the 2019 results announcement by Xiaomi on August 20. The growth in performance data is back. According to the financial report, in the second quarter of 2019, Xiaomi's total revenue reached 51.951 billion yuan, up 14.% year-on-year and 18.7% quarter-on-quarter; adjusted net profit reached 3.635 billion yuan, up 71.7% year-on-year and 74.7% quarter-on-quarter.