Like most whistleblower press conferences, the whistleblower became a war of words. Although the two sides currently have their own opinions, it cannot be denied that Cai Wensheng's investment of 4399 has brought him a lot of trouble.
AI Finance (ID:Economic-Weekly)
Text | Zhou Jingjing Pang Lingzi Zheng Yahong
Edit | Jasin
On June 20, the Westin Hotel on Beijing Financial Street once again staged a whistleblowing press conference, investors "in the name of leeks" reported 4399 "IPO with illness", and Internet tycoon Cai Wensheng became the target of "sniping".
Instructions for the press conference circulated online
Invitations received by the media
At the press conference, whistleblowers said Cai Wensheng, the major shareholder of 4399, was suspected of evading hundreds of millions of yuan in state taxes, as well as six other major problems. Subsequently, Cai Wensheng issued a statement to respond to it one by one, and also posted tax payment certificates, and in May 2014, he paid about 130 million yuan of personal income tax.
Report and be reported
The protagonists of this report are Jiang Heping and Li Shengli, shareholders of Shanghai Dinglin Equity Investment Fund. The content of the report mainly focuses on the undisclosed major matters of the company, including major changes in the share capital between 2011 and 2013, major changes in major shareholders and controllers, and the way and price at which the company introduced investors.
After the press conference, the whistleblower letter of Shanghai Dinglin was quickly circulated on the Internet, and the content was more informative.
Shanghai Dinglin's break with 4399 began in 2013. According to the latest prospectus, the company made a major capital reduction in June 2013, reaching 100 million yuan. During this period, 13 shareholders, including Shanghai Dinglin, paid capital reductions.
At present, Shanghai Dinglin no longer holds shares in 4399.
Also in 2013, Tibet Chenqi acquired 24% of the equity of 43999 at a valuation of 3 billion yuan and 720 million yuan, while the net assets of 4399 at that time were less than 400 million. For the whereabouts of this money, Shanghai Dinglin questioned, "The capital increase into the 4399 company, or the money to the original major shareholder Cai Wensheng, Cai Wensheng concealed this fact is suspected of tax evasion." ”
After the press conference, Cai Wensheng responded to the content of the report, saying that he had transferred most of the equity of 4399 Network Co., Ltd. in 2013, and currently only holds 1.36% of the equity, and has fulfilled his tax obligations in accordance with the law and paid personal income tax in full.
Cai Wensheng further explained in the statement that he has completely withdrawn from the management of 4399 since 2013, and has no longer participated in all management activities after 4399, nor does he know Jiang Heping and Li Shengli.
For the report, Cai Wensheng believes that all the information is his personal subjective inference, and there is no evidence to prove that he will take legal measures to pursue his legal responsibility.
Cai Wensheng had broken with another shareholder
As a grassroots game website, 4399 initially provided users with a large number of game resources by pirating or cracking small games, and at the same time gained excellent reputation in the user experience with "no card, not slow, and continuous", accumulating and absorbing a large amount of traffic.
4399 physical stores. Image from CFP
The cleverness of 4399 is that after accumulating and absorbing a large amount of traffic, they began to recruit a large number of game developers to develop genuine games for them, and the road of whitewashing transformation began, and 4399 gradually shifted from small games to web games.
At first, it was not optimistic about the industry, but with the rise of page games in 2007 to achieve a spurt of development, from 2011 to achieve profits of more than 100 million, by 2012 revenue has reached 1 billion, occupying nearly 10% of the market share.
The momentum of 4399 has attracted some talents. If There is a Baidu background and understand the technology of Cao Zheng into the 4399.
At that time, Cai Wensheng was intoxicated with Weibo marketing, had no intention of asking about the company's affairs, and when the company's authority gradually faded, another high-level Luo Haijian began to have the idea of taking charge of the overall situation, and began to work from Cao Zheng. Cao Zheng reduced his stake from the initial 5% to 1.5%, and eventually left 4399 with 2 million in cash.
Cao Zheng's exit allowed Cai Wensheng and Luo Haijian to officially end their former intimate relationship. This is the "equity gate" that made a lot of noise in the city and almost discredited Cai Wensheng.
After that, Cao Zheng said in Weibo, "Because the two sides have different understandings and differences, after multi-party coordination, an agreement has been reached, thank you for the support and concern of friends, entrepreneurship is not easy, and it is good and cherished, I wish 4399 company a bright future." ”
Cai Wensheng turned to the Weibo and commented, "Say it well, do it and cherish it, and wish Cao Zheng a successful business!" ”
In the end, the two sides ended in reconciliation.
Cai Wensheng withdrew
Around the time of Cao Zheng's departure, Cai Wensheng also had plans to gradually withdraw.
In the early days of 4399, Cai Wensheng held 67% of the shares, Li Xingping and Luo Haijian each held 15%, and the remaining 3% was held by another natural person. Since then, the company has placed the main business in Guangzhou and established Guangzhou Youjia, which is responsible for Luo Haijian.
According to Shanghai Dinglin's introduction at the press conference, due to the rapid expansion of Guangzhou Youjia, Cai Wensheng adopted the method of reward and transferred 19% of his equity to Luo Haijian, and Cai Wensheng's shareholding ratio dropped to 47%.
At the beginning of 2014, it was reported that Cai Wensheng had withdrawn his investment, and the company's response was that Cai Wensheng had always been an important shareholder, but recently due to personal reasons, he slowly faded out of daily management. Judging from Cai Wensheng's statement on June 20, the divestment rumors are not empty.
Judging from later media reports, Cai Wensheng has already replaced the shares held by 4399 with luo Haijian's shares in Forgame (Yunyou Holdings). The Forgame that Cai Wensheng bought from Luo Haijian was listed at the end of 2013, and its market value exceeded 6 billion yuan in April 2014.
The turmoil at the top has spread to the middle and grass roots. Since 2013, various internal problems have emerged in an endless stream. First of all, the core team of the studio was moved, and the management of 4399 immediately threw out the "BMW policy" - retaining 5 cores of the studio that were about to leave the studio with 5 SETS, and promised to buy a house and a car for the whole studio, but did not fulfill the commitment. In the Guangzhou branch, the departure list even involves some vice presidents, assistant presidents, project leaders and other senior executives, and the total number of laid-off employees is close to 300, accounting for about one-eighth of the company's total number.
Revenue growth is not as fast as the industry
Abandoned by Cai Wensheng, the performance of 4399 is also not matched with the entire market.
According to the latest prospectus of 4399, from 2013 to 2015, the company's operating income was 1469.7132 million yuan, 1542.5188 million yuan and 1645.5751 million yuan, respectively, with an average annual compound growth rate of only 5.81%. In the same period, the compound growth rate of China's game market reached 30.07%.
The revenue sources of 4399 are mainly the operation income of the game's own platform, the intermodal transportation income of the game's third-party platform and the advertising revenue, accounting for 77.56%, 17.20% and 5.09% of the company's total revenue in 2015, respectively.
Although since 2013, the field of page games has entered a period of stagnation in development, followed by the decline in the fame of 4399, and it has to think of changes, transform and expand the mobile game business, and create multiple studios such as Home. However, as of the end of 2015, about 78.70% of the main business income still came from web games.
In addition, AI Finance and Economics also found in the enterprise investigation that since 2014, 4399 has involved a total of 39 litigation cases, mostly unfair competition infringement disputes such as copyright and trademark rights.
In addition to developing its own business, 4399 also has the ambition to embrace the capital market. In 2014, it submitted a prospectus to the CSRC for listing on the Growth Enterprise Market (GEM). However, in March 2015, the CSRC suspended the review of the 4399 IPO due to "incomplete application documents, etc., resulting in the inability to continue the review process", but some media questioned that its incomplete documents were just an excuse, but in fact, the net profit and revenue were too small.
In April of the same year, 4399 once again impacted the IPO after completing the relevant materials, and finally returned home.
In June 2016, the CSRC website once again published a prospectus for the listing of 4399 on the Growth Enterprise Market (GEM). At present, in addition to encountering real-name reports, there is no news of the progress of the listing of more companies.
[This article is original by AI Finance and Economics and produced by Caijing World Weekly]
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