On Sunday, the deposed co-founder of Dangdang, Li Guoqing, broke into the company’s Beijing headquarters. He and six others took control of the company’s official seals in an attempt to regain control of the company.
Why it matters: Dangdang was once a top e-commerce platform, but a drawn-out power struggle as well as divorce drama between Li and his ex-wife and co-founder, Yu Yu, has clouded the company’s future.
- Corporate seals, sometimes called a “chop,” are considered a company’s legal signature. Once the seal is stamped on a document, the document is considered legally effective and binding.
Details: Li, who grabbed nearly 50 company stamps and financial seals on Sunday, claims this is only the first step. Li said to local media that he will build his own team for a final takeover of Dangdang.
- A video of the whole coup shows the group encountered little pushback from employees.
- In a letter to employees distributed during the visit, Li says he will take over the company’s operations, while Yu Yu will no longer be executive director, legal representative, nor general manager.
- Kan Min, vice president of the company, said to local media that Li’s claims in the letter are not true, adding that Dangdang has reported this case to the police.
- The company declared void the seals taken by Li.
Context: Founded in 1999, Dangdang started as an online bookseller and expanded into a massive e-commerce company. Despite Dangdang’s early rise to prominence, the online bookseller gradually lost the battle with younger competitors like JD.
- In February 2019, Li Guoqing announced in an open letter that he has left the company, indicating a peaceful handover.
- In October, Li said he filed for a divorce in July last year, but Yu didn’t agree.
- Things turned ugly after Li claimed in an October interview that he was forced to leave the company by Yu, In the video interview, he can be seen losing his temper and throwing a glass of water on the floor
- Yu fought back, accusing Li of domestic abuse, extramarital affairs with men, and stealing RMB 130 million out of their joint savings account.
- The outspoken entrepreneur has drawn criticism for sexist comments. He defended Yu Minhong when the New Oriental Group founder blamed women for the country’s declining moral standards as well as Richard Liu when the JD founder was embroiled in a rape scandal.