By love-89.com In late August, Din Tai Fung announced the closure of 14 locations in Northern China, including one in Xiamen. However, Beijing Hengtai Fung is planning to hold an emergency shareholders’ meeting to conduct a complete re-election of its board of directors. Reports suggest the new board may remove Chairman Han Jiachen from his position and will seek an extension on the business license from the relevant authorities in Beijing.
According to recent statements from Beijing Hengtai Fung, the shareholders’ meeting is set for today. This meeting will lead to a comprehensive re-election of the board and supervisory committee, with the possibility of ousting Han Jiachen as chairman. Following the meeting, a press conference is planned to clarify the future of the 14 Din Tai Fung locations in Northern China.
In response to the potential leadership change, Han expressed surprise at the news of his impending removal, attributing it to differing opinions among shareholders, though he declined to delve into specifics.
It’s worth noting that Han Jiachen secured a 20-year authorization from Taiwan’s Din Tai Fung in 2005 through personal connections, with both Han and Taiwan’s Din Tai Fung Chairman Yang Jihua holding shares in Hengtai Fung. However, Hengtai Fung asserts that it is a 100% subsidiary of Beijing Giant. When rumors surfaced about the closure of the Northern China locations, Dacheng Group previously stated that it does not have control over Beijing Hengtai Fung, suggesting possible rifts among major shareholders.
The restaurant industry in mainland China has faced significant challenges in recent years due to the impact of the pandemic. Reports indicate that differences of opinion among shareholders emerged after three years of losses, prompting the decision to shut down the 14 Northern China establishments by the end of October.
As the authorization from Din Tai Fung has expired, the crucial factor now is whether Hengtai Fung can secure a continued authorization from Din Tai Fung after submitting a business license extension request to Beijing’s regulatory authorities.
Previously, Taiwan’s Din Tai Fung indicated a preference to conclude operations in Northern China and had issued statements to that effect. However, it remains unclear where they stand in this shareholder dispute and whether they will continue granting authorization. As of the publication deadline, Din Tai Fung had not made a formal statement.
Industry analysts suggest that after 20 years in the mainland market, the key techniques of Din Tai Fung have likely been learned by competitors. Should the new board fail to secure authorization, it might not be difficult for a new entity to rebrand and sell similar products, potentially leading to a confusing dual-brand scenario in China.
Taiwan’s Din Tai Fung has clarified that its restaurants in Beijing, Tianjin, Qingdao, Xiamen, and Xi’an are managed by Beijing Hengtai Fung, which will not renew its business license, resulting in an early termination of the brand authorization. The 14 locations are expected to cease operations by October 31, 2024, and Din Tai Fung headquarters has instructed the local management teams to address the rights of employees, customers, and suppliers effectively.
Despite these closures, Din Tai Fung confirmed that their 18 locations in cities such as Shanghai, Suzhou, Wuxi, Nanjing, Jiaxing, Hangzhou, Ningbo, Guangzhou, and Shenzhen will continue normal operations without any disruption.