Minsheng Securities in Management Shakeup Before Guolian Buyout

Minsheng Securities Co. Ltd., a Shanghai-based investment bank, is undergoing a senior management team reorganization in preparation for an upcoming acquisition by its larger rival, Guolian Securities Co. Ltd. [para. 1] Minsheng has appointed three seasoned executives from Guolian to its top management positions, signaling a strategic reshuffle associated with significant industry consolidation. [para. 2] Guolian, whose parent company Guolian Group already holds a 30% stake in Minsheng, recently disclosed plans to acquire the entire unlisted entity, further concentrating China's securities industry. [para. 3]

At the forefront of the new appointments, Wang Jinling, a former chief information officer at Guolian, has been named chairman of Minsheng’s executive committee and will oversee human resources. [para. 4] Wang’s tenure at Guolian traces back to 2019 when he joined from Citic Securities Co. Ltd, China's largest brokerage. His more recent roles included becoming an assistant president at Guolian Group in 2023, and in January, he joined Minsheng’s board along with Gu Wei, president of Guolian Group and now Minsheng's chairman. [para. 5]

The reshuffle didn't stop with Wang; Guolian veterans Chen Xingjun and Yang Hai have also joined Minsheng’s executive team. Chen, formerly the chief risk officer at Guolian, now serves as Minsheng’s vice president and chief financial officer, while Yang, who led Guolian’s investment unit, is Minsheng's vice president and board secretary. [para. 6] Additionally, Minsheng has promoted its vice president and chief financial officer, Xiong Leiming, to the position of president, a move designed to oversee the company’s investment business as it navigates through this transitional period. [para. 7] Xiong stepped into his role as acting president in 2022 following the investigation of the former chairman and president, Feng Henian, for corruption. [para. 8]

Despite Xiong’s new title, industry insiders perceive Wang Jinling as the dominant executive figure, largely due to Guolian's imminent complete acquisition of Minsheng. [para. 9] Currently, Minsheng’s executive team comprises 14 members, but the reorganization is ongoing, and several senior executives are expected to step down, posing challenges to the firm’s strategic development due to a significant turnover in its investment banking team over the past year. [para. 10]

Minsheng, founded in 1986, was predominantly owned (87.7%) by Oceanwide Holdings Co. Ltd. before the conglomerate encountered financial crises. In March 2023, Oceanwide’s stake had to be auctioned by a court due to defaulting on a bridge loan from Shandong Hi-Speed Group Corp., a state-run highway entity. [para. 11] Guolian Group emerged as the winning bidder for a 30.3% stake in Minsheng, securing it for 9.1 billion yuan ($1.3 billion) after an intense auction involving 162 bidding rounds against other contenders like Soochow Securities Co. Ltd. and Zheshang Securities Co. Ltd. [para. 12]

In late April, Guolian Securities, which is 46% owned by Guolian Group, announced a fundraising initiative to finalize the takeover of Minsheng. The acquisition will cost 11.31 yuan per share, totaling an undisclosed amount paid to 46 shareholders, including Guolian Group. To finance this, Guolian Securities plans to raise up to 2 billion yuan through a share placement. [para. 13]

For further detailed information, contact reporter Han Wei at weihan@caixin.com. [para. 14]