TORONTO – Hanfeng Evergreen Inc. (TSX:HF) says it has called off a going-private transaction led by a key shareholder and that he is “no longer” the company’s CEO, president or legal representative of its subsidiaries.
The Chinese fertilizer company says former CEO Xinduo Yu remains a director, but chief financial officer Niral Merchant will report directly to the board of directors.
Hanfeng Evergreen has most of its operations in China and Southeast Asia, but its stock listing is on the Toronto Stock Exchange.
Yu has been attempting for about a year to buy up the Hanfeng traded shares he didn’t already own or control.
He had about 20.2 per cent of Hanfeng shares when the company received his unsolicited offer last January.
In December, Hanfeng announced that its major customer, Beidahuang Agricultural Company, had issued a notice that it would severe all ties with the company — citing the stalled privatization process.
In a statement issued Wednesday after markets closed, Yu said he would be taking his battle with the current board to the company’s annual and special meeting Feb. 28 where he plans to nominate a new slate of independent directors.
Yu also said that despite what he described as his “purported termination” as president and CEO, “he and his current management team will continue to lead the Hanfeng effort until the inevitable replacement of the current board members led by the chairman of the board, Loudon Owen.”
“Until then, it will be business as usual at Hanfeng and we will do our utmost to fix the problems we believe have been caused by the current directors, including rectifying relationships with our key Sino-stakeholders,” he said in a statement.
On the Toronto Stock Exchange, Hanfeng shares closed down two cents at 48 cents Wednesday.