Shenzhen Langkun Technology Co., Ltd. (Langkun Technology) announced on October 12 that the actual controller of the company got divorced, with the female party obtaining shares in the company worth 130 million yuan. This marks another case of a high-profile divorce in the A-share market.
According to the announcement released by Langkun Technology on October 12 titled “Notice of Change in Equity of Actual Controller and Signing of the ‘Joint Action Agreement’,” it was stated that Mr. Chen Jianxiang, the actual controller of the company, and Ms. Zhang Liyin have terminated their marital relationship. According to the “Divorce Settlement Agreement,” Ms. Zhang Liyin now directly owns 15.3 million shares of the company’s stock, and 5.2 million shares previously held by Mr. Chen Jianxiang will be transferred to Ms. Zhang Liyin through non-trading transfer.
It was disclosed by the “Daily Economic News” that based on the closing price on October 12, the 5.2 million shares obtained by Zhang Liyin are valued at 129.272 million yuan.
The announcement also mentioned that after the divorce, “Mr. Chen Jianxiang remains the actual controller of the company, while Ms. Zhang Liyin will no longer act as the actual controller but will remain a shareholder of the company. They have signed a ‘Joint Action Agreement,’ with Ms. Zhang Liyin being a concerted action person of Mr. Chen Jianxiang, and their holdings will still be consolidated.”
Public data shows that Shenzhen Langkun Technology Co., Ltd. was established in 2001, with its headquarters located in Longgang District, Shenzhen. Langkun Technology (including Langkun Environmental Group) mainly engages in investment, construction, and operation of organic solid waste projects and domestic waste incineration power generation projects through concessions such as BOT and BOO.
The “Daily Economic News” stated that the company’s financial performance for the years 2023 to 2025 showed that both operating income and net profit attributable to the parent company were profitable. However, in the past month, Langkun Technology’s stock price fluctuated between 24 yuan and 27 yuan per share, with the closing price on October 12 at 24.86 yuan/share, slightly lower than the peak in late September.
In the A-share market, cases of actual controllers or major shareholders dividing assets due to divorce are not uncommon, sparking market attention each time. Many divorces are under scrutiny in the market, with concerns that divorces are aimed at evading regulation and are considered as “fake divorces, real reduction of holdings.”
According to relevant regulations, shareholders in the Chinese stock market who hold more than 5% of shares must make public announcements when reducing their holdings, leading to stock price fluctuations, and being subject to restrictions such as profit warnings (breaking net, breaking issuance, not meeting dividend standards). Hence, many individuals resort to asset division through divorce or reducing their holdings below the 5% threshold to facilitate future cash-out.
In some cases, companies facing operational crises, debt crises, or potential litigation risks may allocate a significant portion of their equity to their spouses through divorce, financially isolating themselves to achieve the purpose of “separating debt and preserving wealth.”
Moreover, there are instances where successful businesses result in broken marriages, leading to divorces due to the struggle for control of the company. Such divorces often lead to the dispersal of company control, triggering ongoing battles for equity ownership.
Currently, the record for the most expensive divorce settlement in A-shares is held by Kangtai Biotech. In May 2020, Kangtai Biotech’s actual controller Du Weimin divided 161 million shares to Yuan Liping due to their divorce, with the market value reaching as high as 23.554 billion yuan based on the stock price at that time, setting an all-time high in A-shares history.
“Jiemian News” reported that in recent years, there have been frequent cases in the A-share market where equity has been divided through divorces, transferring substantial restricted shares from individual entities to spouses. This method not only avoids the restrictions on the reduction of holdings imposed by the “Interim Measures for the Management of Share Reduction by Shareholders of Listed Companies” but also exempts them from paying capital gains tax as property division is not considered a “reduction behavior,” thus achieving low-cost, low-risk asset redistribution. Therefore, every high-profile divorce case in A-shares tends to attract market attention, speculation, and discussions regarding the “divorce-oriented reduction of holdings.”