Veto on Chairman's Ouster Lifts Brewer


SHANGHAI-LISTED Chongqing Brewery rose to a four-week high yesterday after shareholders on Tuesday overwhelmingly vetoed a bid to unseat its chairman who was held responsible by a major shareholder for the collapse in the firm's share price in December.

Its shares surged 5.5 percent to 24.74 yuan (US$3.93) yesterday, the highest since January 11, after they voted to keep Huang Minggui as chairman. Dacheng Fund Management Co, which blamed the price collapse on Huang's poor management of information disclosure, had demanded that he step down.

More than 97 percent of the 70 shareholders representing 54.87 percent of the total stocks, who attended the meeting, rejected Dacheng's motion, the brewer said in a filing to the Shanghai Stock Exchange.

The company's market value shrank nearly 70 percent, or 27.7 billion yuan (US$ 4.4 billion), after it announced in December that its self-developed hepatitis B vaccine failed to pass a critical test in its latest stage, which spooked investors.

Dacheng saw the value of its over 10 percent stake in the brewer shrink dramatically after the share price collapsed and it held Huang responsible for the incomplete account of the experiment progress and the lack of data interpretation.

Huang defended the 100 million yuan-invested vaccine research during the shareholders' meeting as a business-oriented and innovation-driven project, which led Dacheng's representatives to walk out as a protest.

Danish brewer Carlsberg, which holds 30 percent in the brewer, said in a statement in June it would support research in the vaccine project.

A final experiment report due for release in April may disclose the vaccine research methodology.

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