Private equity-backed sportswear company Li Ning has suffered the latest in a string of setbacks after its eponymous founder announced he was selling a 25 per cent stake in the company.
Former gymnast Li Ning, pictured, will sell the stake to his talent management agency Viva China Holdings for $175m, a decision which saw shares in the company drop more than six per cent.
The business suspended its shares at the end of last week ahead of making a statement to the Hong Kong bourse, although did not reveal details at the time.
It suffered its latest senior management walkout two weeks ago when CFO Chong Yik Kay resigned.
Li Ning replaced chief executive Zhang Zhiyong three months ago and had pledged to focus its operations on China following a dramatic slump in the company’s share price.
The company has previously said it plans to cut back on new store openings after expanding in the wake of the Beijing Olympics four years ago.
Li Ning’s first-half profit fell 85 per cent as unsold stock accumulated, marketing expenses rose and the company warned it may post a loss amid falling revenues.
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