Chapter 22 Gu Lang Controversy: A Tit-for-Tat War

Each of Gu Chujun’s M&A targets is a well-established state-owned enterprise, and the secretive negotiation process and fast transaction speed have filled the outside world with various speculations and imaginations, and he himself seems to make no secret of this.In a conversation with a reporter, he said bluntly: "State-owned enterprises are easy to enter. If I don't want it, waste is waste." The publication of these remarks has stimulated people's nerves again and again.In a sense, the tornado-like disaster in the future was initiated and brewed by Gu Chujun himself.

In August 2004, Gu Chujun, who was on the expedition to the west, completed two consecutive acquisitions: he bought Shangqiu Bingxiong Refrigeration Equipment Company for 184 million yuan, and promised to invest 1.5 billion yuan to build a refrigeration industrial base; Also acquired the listed company Huayi Compression.On the 9th of this month, Professor Lang Xianping of the Hong Kong University of Science and Technology gave a speech at Fudan University titled "Greencool: Carnival at the Feast of "National Retirement and Democratic Advancement", pointing out that Gu Chujun used the "seven axes" trick to fight against the "National Retirement" In the process of "democratic progress", the country's wealth was swept away.Within a few days, the content of Lang Xianping's speech was widely published in major domestic newspapers and websites, and public opinion was heated for a while.

Gu Chujun, who was on the brink of mergers and acquisitions, obviously didn't realize how bad the comer was.He has always liked to use high-pressure and fierce means to confront any doubts from the outside world, and this time is of course no exception. On August 13, Gu Chujun sent a stern lawyer's letter to Lang Xianping, claiming that Lang Xianping's speech had defamed him.Lang Xianping held a media meeting three days later and released the lawyer's letter, stating that "there will never be changes or apologies", and he complained that "power cannot trample on academics". On August 17, Gu Chujun submitted a complaint to the Hong Kong High Court, suing Lang Xianping for alleged defamation.Two middle-aged men with a 3-year difference in age (Gu Chujun was born in 1959, and Lang Xianping was born in 1956), both with gray hair and strong temperaments, started a tit-for-tat war.

Lang Xianping’s many accusations against Gu Chujun mainly focused on two aspects: First, during the acquisition process, there was a related party transaction between Greencool and the original controlling shareholder. In the past two years, various expenses have been lowered, and the company has turned around in one fell swoop."On this point, Professor Lang said that he was right and scolded the wrong person. Gu Chujun was actually a half victim.The second is to use the strong cash flow of Kelon Electric to complete various acquisitions.Lang Xianping concluded through financial calculations that Gu Chujun embezzled a large amount of Kelon's funds for acquisitions. He took advantage of the idea of ​​some local governments eager to speed up the exit of state-owned enterprises, and packaged acquisitions and restructuring together. 100 million yuan of state-owned assets, playing a win-win game of mutual benefit for both parties.

Lang Xianping concluded from the Kelon phenomenon: "The problems in China's 'retirement of the state and the advancement of the people' are very similar to those in Russia's privatization process. They all took advantage of the imperfect legal system to embezzle state-owned assets legally." As soon as the theory came out, doubts about Gu Chujun quickly escalated into heated debates in the media, academia, and even political circles over the strategy of "retire the country and advance the people."For a while, the opinions were tit-for-tat. Some scholars believed that Lang Xianping's argument was biased, misunderstood the general direction of Chinese enterprise reform, and was not tolerant enough.Professor Zhang Weiying of Peking University also delivered a speech, calling on the public opinion environment to "treat entrepreneurs well and not demonize them".At the same time, some scholars applauded Lang Xianping loudly. More than 10 people including researcher Zuo Dapei of the Chinese Academy of Social Sciences even jointly issued a statement "supporting Lang Xianping".This big debate suddenly set off a turbulent wave. Almost all heavyweight scholars in the Chinese economic circles expressed their views, defending "Gu" and defending "Lang". They are in stark opposition, forming the largest and most explosive debate in the field of economic theory in the past 20 years. A big debate.

The sudden change in the situation was obviously far beyond Gu Chujun's expectations.In this turmoil, he and Greencool became "props" in the debate between the two sides, which was extremely embarrassing.Any entrepreneur who has attracted public attention, his growth experience is like a tower built of many large and small building blocks, even if one of them is not firm, it may cause the entire building block tower to shake or collapse; and There are too many suspicious "building blocks" in Gu Chujun's experience that cannot withstand scrutiny and empirical evidence. Even if it is already shaky in normal times, how can it stand up to the torrential torture of Lang Xianping and others?

On October 24, Gu Chujun from "Eye of the Storm" appeared at a seminar in Beijing.He said: “This time I was somehow involved in something that should not be discussed by our business community, and once again became a party to the so-called debate on China’s economic reform. I don’t want to participate in this debate at all, and I don’t want to discuss this matter.”4 Days later, Gu Chujun, who "doesn't want to discuss", made a high-profile counterattack again.He invited the Institute of Enterprise Economics of the Development Research Center of the State Council to co-organize a seminar on "Kelon's 20-year development and the reform path of Chinese enterprises".At the meeting, the Institute of Enterprise Economics issued a rare report for Kelon that verified its integrity and comprehensively affirmed its reform experience.The next day, the summary of this report was published in the pages of major financial media in the form of advertisements.Gu Chujun said quite proudly: "Many comments outside make me feel like I have gone back to the 'Cultural Revolution'... Now it is overnight, and many economists think that I have no problem."

Looking at the after effects, the seminar, report and adverts had a negative effect.Gu Chujun seems to be getting darker and darker. In the public impression, he has obviously become a symbolic figure of embezzling state-owned assets.At the same time as the symposium was held, the Audit Office quietly entered Kelon Electric to conduct investigations; in November, the Shenzhen Stock Exchange and the Hong Kong Stock Exchange entered Kelon's headquarters to conduct centralized inspections of its financial problems. In January 2005, the Hong Kong Stock Exchange publicly condemned Gu Chujun in the name of connected transactions, and Kelon's stock price plummeted.

At this time, Gu Chu's army was defeated like a mountain.The denunciation of public opinion has finally affected the home appliance business.In the first nine months of 2004, Kelon also generated a profit of 200 million yuan, but the sharp decline in sales in the fourth quarter dragged the annual performance into a quagmire again. In April 2005, Kelon Electric issued a pre-loss announcement, saying that the annual loss was about 60 million yuan. In May, the China Securities Regulatory Commission officially announced the investigation of Kelon Electric in the name of suspected violation of securities laws and regulations.The company's normal business operations suddenly became chaotic.All banks have completely stopped lending to Kelon, and some even directly withhold the repayment from dealers.Since June, suppliers of air conditioners and refrigerators across the country have successively stopped supplying raw materials to Kelon, and Kelon's production lines have gradually shut down.A reporter went to the Kelong Shunde base for an interview and wrote: "The workshop that was still in full swing half a year ago suddenly became dead silent. Walking by the empty production line, it seems to smell the breath of the grave."

During this time, Gu Chujun has been running around in Beijing.He knew that the defeat was a foregone conclusion, and the only thing he could do now was to sell Kelon as soon as possible in order to get out of the way.He successively threw hydrangeas to Changhong, Hisense and other industry peers, but he also made it clear that he would not sell to TCL and Haier, because "he himself is not optimistic about the development of these two companies." Don't change your nature of being flamboyant and good at pointing out the country. On July 29, Gu Chujun suddenly lost contact with all his subordinates. The next day they were told, "Gu Chujun was taken away by the Foshan City Public Security Bureau and brought under control."

Gu Chujun, whose reputation has been discredited, is unable to return to heaven. He is imprisoned, and he witnesses the property he has painstakingly obtained over the years being divided up by everyone. In September, he signed an equity transfer agreement with representatives of Qingdao Hisense in the detention center.The color TV company in Shandong finally became the new owner of Kelon unexpectedly with a bid of 680 million yuan.The acquisition of Hefei Meiling is Gu Chujun's most proud handwriting after Kelon. In October, Shanghai's "Daily Economic News" first disclosed that Sichuan Changhong, a veteran color TV company, might acquire Greencool's equity in Meiling Electric. The deal was finally concluded in the spring of 2006.Yaxing Bus, which was acquired by Gu Chujun, also quickly escaped from the sinking ship. The Yangzhou Municipal Government quickly froze the equity held by Greencool. A year later, Southeast Automobile became the new buyer.Among all the companies that Gu Chujun has touched, Xiangyang Bearing may be the least injured one.As soon as the news of Gu Chujun's detention came out, the Xiangyang District Government announced the termination of the equity transfer agreement reached with Greencool. The agreement has not been officially approved by the China Securities Regulatory Commission. On October 26, the results of the China Securities Regulatory Commission's investigation of Kelon Electric were officially exposed.According to the report: "Gu Chujun and others and related companies related to 'Greencool' are suspected of embezzling and misappropriating the property of Kelon Electric. Towards conducted an investigation and found that the accumulated abnormal cash flow exceeded 7.5 billion yuan. In August, the long-awaited 2005 annual report of Kelon Electric finally came out. This is another figure that challenges the psychological limit of shareholders: a huge loss of up to 3.693 billion yuan, setting a new record for mainland listed companies that year. Loss record; involved in 93 lawsuits, the largest number of cases involved in mainland listed companies in recent years; the company's net assets are -1.09 billion yuan. In this way, counting from the winter of 1998 when Pan Ning was "forced" to retire, the world has turned upside down in seven years. The home appliance company with the best efficiency and the most modern temperament in mainland China has been reduced to a "bad company" with many losses and lawsuits. ". After Gu Chujun's accident, Professor Zhou Qiren of Peking University, who had acquaintance with Pan Ning, commented: "It was not Kelon's restructuring that gave Greencool a chance, but it was precisely the lack of timely restructuring. The main lesson of Kelon is Pan Ning The Times did not initiate and complete the property rights reform in time, otherwise Gu Chujun would not have had the chance to take over.” He wrote in a column: “Reading Kelon’s report, I was tortured by a question: If the entrepreneurial boss Pan Ning Under the leadership of that generation, did Kelong end up where he is today? Knowing that history cannot be assumed, I can’t help but think that way...Kelon’s ending seems to be due to timing, luck, and fate. I want to cry but have no tears .” Professor Zhou Qiren gave the column a very special title, which is rarely used by rigorous economists - "Unfortunately, Kelong".