TAIPEI (Taiwan News) — A feud between the management of a Taiwanese household-appliance maker and its shareholders reached a climax on Tuesday (June 30) as the company's chairwoman declared some shareholders' votes void at the general shareholder meeting, which was followed by punitive measures put in place against the company by regulators.
On Tuesday (June 30), Tatung Co. blocked some institutional and individual shareholders from participating in the general shareholders' meeting. The company, which is currently operating at a loss, created a 300-person human barricade at the doors to a meeting room.
In the meeting, Chairwoman Lin Kuo Wen-yen (林郭文艷) denied votes to shareholders who were said to be likely to vote against her reelection, which was a group representing over 50 percent of the total shareholders. No explanation was given for her bizarre and dictatorial conduct.
As a result, the current chairwoman's favored candidates for all six board of directors seats and three independent directors seats all won. Lin Kuo secured her position as the company's top manager amid angry shouts and curses from individual investors.
The company later issued a statement accusing the disenfranchised shareholders of breaching the Business Mergers and Acquisitions Act and the Act Governing Relations Between the People of the Taiwan Area and the Mainland Area, which the shareholders denied.
The controversial happenings soon received the attention of the country's financial authorities. The vote would soon be investigated, according to the Financial Supervisory Commission (FSC).
The Taiwan Stock Exchange Corp (TWSE) announced on Tuesday punitive measures against the company, citing non-compliance with corporate governance and limiting the company stocks to cash trading in a move to protect investors. Company stock prices plummeted to the maximum daily limit of 10 percent Wednesday after the announcement.
Lin Kuo and other figures in the organization have previously been criticized for mismanagement. Six of the household-appliance maker's eight subsidiaries recorded a loss in the fiscal year 2018.
Among the company's loss leaders in recent years have been San Chih Semiconductor Co., reporting an after-tax loss of NT$17.52 (US$.59) per share in 2018; the debt-ridden flat-panel maker Chunghwa Picture Tubes Ltd. (CPT); and Green Energy Technology Inc. All three companies were delisted from the main board last year.
Over 600 former CPT workers staged a protest at Tatung headquarters in Taipei over unpaid wages and severance packages. CPT, Green Energy, and Tatung USA filed for bankruptcy last year.