Chapter 57 Huawei's shareholding structure revealed

Huawei's internal ownership structure has always been a mystery to the outside world.What kind of company is Huawei?How much is the legendary leader Ren Zhengfei worth?Over the years, as the fog surrounding Huawei has gradually dissipated, many secrets of Huawei have been unraveled one after another, but these two issues have become core secrets and caused widespread controversy. On June 7, 2010, Huawei announced the employee shareholding situation for the first time in the 2009 Corporate Social Responsibility Report released by the company. This is the first time that Huawei has disclosed its shareholding structure to the outside world since its founding 22 years ago. These two mysteries were finally revealed.

This is the first time in Huawei's 22-year history that it has disclosed the company's shareholding structure.This report shows that the wholly-owned shareholder of Huawei Technologies Co., Ltd. is Shenzhen Huawei Investment Holdings Co., Ltd., and Huawei Holdings has two major shareholders. The other shareholder is Ren Zhengfei, a natural person, with a shareholding ratio of 1.42%.However, Huawei did not disclose its total number of shares or total capital. According to Huawei's internal employees, after a certain period of time, employees who join Huawei can obtain a certain amount of equity subscription based on their performance. Employees can voluntarily purchase equity and receive dividends based on equity.However, these shares are not allowed to be traded among employees. When employees leave, the shares held by Huawei will be repurchased.

Ren Zhengfei's negligible personal shareholding will not affect his authority and control. On the contrary, the initiative and enthusiasm of employees and the cohesion and competitiveness of the company will be higher.Because the establishment of Ren Zhengfei's authority is not by controlling employees, but by motivating them. According to industry insiders, we can only roughly estimate the size of Huawei’s total share capital. According to Huawei’s employee allotment rules, the number of employees at each level and the amount of allotment shares at each level, if the allotment goes online, Huawei’s total share capital may be between 7 billion and 8 billion. About 100 million shares.

According to a Huawei employee, Huawei's internal options paid 1.6 yuan per share in 2009, a year-on-year increase of 1.35 yuan. Each share of Huawei stock has already been worth more than 5 yuan this year.If calculated according to the above figures, Ren Zhengfei's personal assets should be 8 billion x 5 yuan x 1.42% = 568 million yuan. According to the data, the annual fixed dividend for Huawei employees is as high as 0.7 yuan per share, and the return on investment reaches 70%. The highest dividend is 0.9 yuan, reaching 90%. After 2001, the majority of employees' income from equity is no longer dividends, but the appreciation of net assets.Therefore, Huawei's cadres and employees are not working for the boss, but "working for themselves".

According to the general law, the process of starting a business is a process of "subtraction", which includes the gradual dilution and reduction of the founder's shares.This process is actually the process of "gathering wealth and people together", and it is also a process in which the founders continue to obtain other bonus points. With the substantial improvement of Huawei's performance, on March 10, 2011, "Forbes" magazine announced the 2011 "Global Rich List", with a total of 116 Chinese people on the list.Robin Li, chairman of Baidu, is the richest man in mainland China with a net worth of US$9.4 billion.Sany Group's Liang Wengen and Wahaha's Zong Qinghou followed with US$8 billion and US$5.9 billion respectively.In addition, Ren Zhengfei, president of Huawei, also entered China's rich list for the first time with US$1.1 billion, ranking 1056th on the global rich list.

This figure is far from the richest man in China, but it is getting closer to Ren Zhengfei's dream of becoming a great world-class enterprise.