After Chen Fashu and his son Chen Yanhui announced their resignations from the board of directors at Yunnan Baiyao, a day later on Monday (27th), Shanghai Pharmaceuticals also announced that Chen Fashu has resigned from all positions at Shanghai Pharmaceuticals, including non-executive director.
On the evening of May 27th, Shanghai Pharmaceuticals announced that the board of directors had received Chen Fashu’s written resignation. Due to work adjustments, Chen Fashu has resigned from all positions including non-executive director and member of the Strategic Committee of the Board of Directors. The resignation report will take effect from the date it was delivered to the board of directors. After resigning, Chen Fashu will no longer hold any positions in the company or its subsidiaries.
According to China Fund News, Chen Fashu’s daughter-in-law Shao Shuai is currently the deputy general manager of Shanghai Pharmaceuticals, while Dong Ming, the CEO of Yunnan Baiyao, continues to serve as an executive director of Shanghai Pharmaceuticals.
During Chen Fashu’s tenure as co-chairman of Yunnan Baiyao, in April 2022, Yunnan Baiyao invested 10.9 billion yuan to become the second largest shareholder of Shanghai Pharmaceuticals, currently holding a 17.97% stake with an approximate market value of 12.3 billion yuan. Shanghai Pharmaceuticals and Yunnan Baiyao have a three-year cooperation agreement. After the cooperation period expires, the future of their relationship has attracted significant market attention.
Just on the evening of May 26th, Yunnan Baiyao announced that directors Chen Fashu, Lu Hongdong, and Chen Yanhui had submitted their resignation reports in recent days, requesting to resign from their positions as directors. The resignation reports took effect upon delivery to the board of directors. Both Chen Fashu and Chen Yanhui will no longer hold any positions in the company or its subsidiaries.
Earlier on May 8th, Economic Observer Network reported a corruption case involving Yunnan Baiyao. Several informed sources revealed that from early 2023 to early 2024, Wang Minghui, former chairman of Yunnan Baiyao, Wang Jin, former chief sales officer and senior vice president, Yin Pinyao, former chief operating officer and senior vice president, Yu Juan, former chief human resources officer, and director Yang Changhong were taken away for investigation. These executives were all announced to have resigned from their positions for personal reasons.
On the 27th, China Securities reported that according to informed sources, Chen Fashu had been under investigation for half a year, possibly related to the same issues for which Wang Minghui and others were being investigated. Chen Fashu had served as co-chairman of Yunnan Baiyao for five years and held a certain influence in the company’s securities investment field.
From 2017 to 2019, under Chen Fashu’s control, Xinhua Du Industry participated in the mixed ownership reform of Yunnan Baiyao and remains the second largest shareholder of Yunnan Baiyao with a current stake of 24.25%. In June 2018, the controlling legal representative of Yunnan Baiyao was changed to Chen Fashu.
As the founder of Xinhua Du, Chen Fashu has been quite active in the A-share capital market, participating in the reorganization of companies such as Zijin Mining and Tsingtao Brewery. In 2009, with a personal wealth of 21.85 billion yuan, Chen Fashu ranked 11th on the Forbes China Rich List, becoming the richest person in Fujian.