Chapter 138: Contradiction (2) |
After that little interruption, Lin Fangzhe stepped onto the podium and began delivering the business briefing for the first half of the year.
His presentation lasted over half an hour, after which he explained, on behalf of the company's management team, the budget proposal for increasing research and development investment in the second half of the year.
Following that explanation, the shareholders raised questions and debated over cash flow usage, dividend expectations, and research risks.
Everyone chatted quite animatedly, with some people even taking a rather sharp tone. But the words weren't particularly fierce, staying within the bounds of rational discussion. Most of the shareholders only asked a few questions and didn't make any clear stance.
Wei Hongsi thought to himself, when it was his turn to go up, he hoped the shareholders wouldn't be so polite.
He was going up there to be a target. If everyone just gave a few polite comments and then simply vetoed him, he'd have taken the stage for nothing.
So he needed a strategy. If the shareholders didn't react, he'd have to find a way to take the initiative.
Wei Hongsi had listened very carefully to Lin Fangzhe's report and the shareholders' comments, and he had gained quite a bit from it. It gave him a deeper understanding of the company's current situation, which would help with his performance.
This was his first time getting a relatively comprehensive picture of Zhiwei Technology's operations.
Zhiwei Technology's net assets were close to 100 billion yuan, including core technology patents, hardware production bases, data centers and computing infrastructure, as well as the Zhiwei Technology Building and other assets. The company achieved about 45 billion yuan in revenue in the first half of the year, maintaining top-tier growth in the industry.
Based on assessments from multiple first-tier asset evaluation agencies and well-known securities research institutes, Zhiwei Technology's current market valuation was between 200 billion and 300 billion yuan.
Zhiwei's shareholders could be roughly divided into three categories.
The first category was the current managers, with only two people. Among them, Director Dai held 52% of the shares, and President Xia held 5%. The latter was currently unable to perform his duties normally.
The second category was the former senior executives of the company's founding team, including President Li and President Liu, whom President Ji had mentioned at lunch, as well as Tai Liqun, who had just given Wei Hongsi a little trouble. There were eight people in total, each holding 3% of the shares, for a total of 24%.
The third category was investors who had entered in the early and middle stages of the company's development. They had never participated in the company's management. There were also eight people in total, each holding 2% of the shares, for a total of 16%.
Calculating it out, Director Dai held 52% of the shares, while the other shareholders held 45%.
Additionally, there was another 3% of the shares, which came from an early investor who had withdrawn. This portion served as an option pool, with Director Dai holding 1.5% on behalf of the company and the remaining 1.5% held jointly by the other shareholders.
Therefore, at the shareholder meeting, Director Dai could actually represent 53.5% of the voting rights, while the other shareholders held a total of 46.5%.
With Director Dai holding more than half the shares individually, he could decide matters like personnel appointments, financial plan reviews, and operational issues all on his own.
However, matters that required special resolutions—such as amending the company's articles of association, capital changes, and equity incentives—required approval from shareholders representing more than two-thirds of the voting rights. That was something Director Dai couldn't decide alone.
The core conflicts between Director Dai and the other shareholders were mainly threefold.
First was the dispute between increasing R&D investment and demanding cash dividends.
From the company's operational strategy perspective, only by continuously increasing investment could they maintain their technological barriers, safeguard their core competitiveness, and ensure the company's industry position. This was the shared goal of Director Dai and the current management team.
But the shareholders believed that since the company had ample cash flow, it should distribute a large portion of profits as dividends. Cutting-edge R&D required massive investment with uncertain returns, which they saw as completely harming their current interests.
The former senior executive shareholders inevitably had a mindset of outsiders who had been sidelined. They had lost their sense of belonging to Zhiwei, so they focused more on the present. As for the investors, their purpose was even simpler—they had been after profit from the very beginning.
Take the project Wei Hongsi was about to present. If the company invested 100 million yuan into it, each shareholder would have to take two to three million less in dividends. Of course, they wouldn't be willing.
Forget about what future returns this project might bring—by that time, who knew what Zhiwei's situation would be, or what their own situation would be?
Second was the dispute between maintaining independence and cashing out through an IPO. This was likely the deepest layer of conflict between the two sides.
If Zhiwei went public, the company's core AI technology, data, and business structure would be forcibly disclosed. It would constantly face short-term performance pressure and be constrained by the capital market and public shareholders. This was absolutely something Director Dai and the current management team did not want to see.
The shareholders, especially the investor shareholders, believed that only by going public could they realize their returns and lock in their gains. Once they had tens of billions in hand, they could completely kick back and relax. Who would care about how the company developed? That was the outcome they most desired.
Some of the former senior executive shareholders might even hope that an IPO would completely change the company's power structure and weaken Director Dai's one-man rule.
Third was the dispute over implementing equity incentives for senior executives versus shareholder opposition to dilution of returns.
The company's current senior executives basically held no equity, and besides their salaries, they didn't enjoy any of the company's dividends. Using an option pool to tie down the core team and prevent talent drain was a common practice for many enterprises.
The shareholders believed that although the 3% option pool was not large, it still meant dilution of equity. Future dividends would be spread thinner, which was essentially the senior executives trying to take a piece of the shareholders' cake while already collecting their salaries.
These three conflicts were not isolated but intertwined.
Director Dai held more than half the equity, and he didn't want the company to go public. There was nothing the other shareholders could do about it. But if he wanted to implement equity incentives, he couldn't get the other shareholders' support, so that couldn't go through either.
As for the issue of R&D investment versus dividends, although Director Dai could force it through, the other shareholders could unite and leverage other matters to hold him hostage—like capital changes, major asset disposals, and so on.
The current standoff between the two sides was in a delicate balance, but that balance could break at any moment.
The shareholders wouldn't give up their pursuit of maximum returns, and Director Dai and the management team didn't want the shareholders holding them back.
After Lin Fangzhe completed this segment, he came down from the stage and took his seat.
Dai Songquan was about to announce the start of the next agenda item when Tai Liqun raised his hand again. "Director Dai, I have something."
Wei Hongsi had already stood up, ready to go on stage, so he stopped and looked at Tai Liqun.
"Please go ahead, Director Tai," Dai Songquan said calmly, without any trace of irritation.
Tai Liqun smiled and said, "Sorry, Director Dai. I've had too much tea, and I'm getting older now. Nature calls, you know."
Then another person spoke up. "Now that Director Tai mentions it, I need to go too."
Someone else added, "Ah, I'm getting a nicotine craving."
Dai Songquan smiled and said, "Alright then, let's take a break. Everyone, feel free."
Wei Hongsi found it somewhat amusing. Were they trying to use the tactic of letting his momentum wither, then wear him down, and finally exhaust him?
