Shareholders of scandal-hit Luckin Coffee have voted out founder Charles Lu, the company’s chairman, along with three other board directors during an extraordinary general meeting held on Sunday, local media reported.
Why it matters: The removal of half of the company’s board of directors is the culminating step in US-listed Luckin’s top management shakeup. The company’s CEO, COO, and many other employees have been fired after the company admitted to accounting fraud in April.
- Lu’s removal from comes shortly after he survived the first round of an ouster which began last week.
Details: Despite being removed from the board, Lu may still retain the upper hand in the power struggle over Luckin, according to local media reports.
- The three other directors who were removed were opposed to Lu.
- They are Sean Shao, chairman to the special committee responsible for Luckin’s internal investigation, and Li Hui and Liu Erhai, two crucial figures in Lu’s funding network who then initiated the campaign to remove Lu after the accounting fraud scandal broke.
- Zeng Ying and Yang Jie, two executives who are reportedly Lu allies, were named as independent board directors.
- Lu might still control of the board, but he may soon lose his grip over the company as lenders led by Credit Suisse target his family’s assets to recoup losses upwards of $500 million losses resulting from the scandal.