Quick Take: Founder of Appliance-Maker Midea Cooks Up 6 Billion Yuan Charity Gift

The founder of Midea Group, a leading Chinese electrical appliance-maker, has announced a donation plan totaling 6 billion yuan ($889 million), including 4 billion yuan in company shares and 2 billion yuan in cash.

He Xiangjian announced the plan at a ceremony Tuesday in Foshan, in southern Guangdong province, where the firm is based.

The fund will be used to support philanthropy in Guangdong and nationwide in poverty relief, education, health care, elder care, entrepreneurship and promotion of cultural heritage.

The 100 million Midea shares will be set up as a charitable trust, whose assets and earnings will be used for philanthropic purposes.

The share price of Shenzhen-listed Midea closed at 42.34 yuan per share on Wednesday, down 2.49% from Tuesday.

The 2 billion yuan cash donation will be provided by a charitable fund that was founded by and named after He in 2013. It also includes a 500 million yuan charitable trust, which was registered with the Guangdong provincial government in May. The trust will be used by a local charitable fund for better construction of a local district.

During the ceremony, He announced that his private fund was being officially renamed the He Foundation. Currently, He’s son, He Jianfeng, serves as the fund’s president.

A number of Chinese corporate leaders have made donations to charities recently. Last year, Tencent Holdings Ltd. founder Pony Ma donated 100 million privately held Tencent shares to a charitable fund. The stock was worth HK$301 ($38.55) per share as of Wednesday. In February, Alibaba Group Holding Ltd. founder Jack Ma donated 35 million shares of Alibaba to SymAsia, a nonprofit based in Singapore. The stock was worth $152 per share as of Wednesday.

Contact reporter Song Shiqing (shiqingsong@caixin.com)