Taiwan Pacific SOGO Department Store Management Dispute Again

Recently, the dispute over the operation of SOGO Pacific department store in Taiwan has been heard for 12 years.

Taiwan's "Supreme Court" was the first judge of the second instance. Zhang Minqiang, founder of Pacific SOGO department and chairman of Pacific construction, won the lawsuit. Li Henglong, chairman of Taiwan Pacific distribution company, must return the 60% stake in Pacific Ocean Circulation of Pacific SOGO department store, totaling 600 thousand shares.

In the past 12 years, Zhang Minqiang has been ruled out.

It has been reported that after winning the SOGO department store in the Pacific, Zhang Min Qiang declared that he will continue to work hard to regain the right to operate the Pacific SOGO department store.

However, as far as the equity situation is concerned, since the Far East Group has increased its capital to the Pacific Ocean by 4 billion NT $600 thousand, the 600 thousand stocks (or total NT $600) are only small shareholders.

Zhang Minqiang has to face the fact that in the 12 years of litigation, SOGO department stores in the Pacific have already left others.

In response to this, the group said publicly that the dispute between Zhang Min Qiang and Li Henglong on the 0.15% equity interest in the Pacific circulation would not change the fact that the company had a 99.85% stake in the Pacific currency, regardless of the outcome of the decision, and would not affect the company's control over the subsidiary's Pacific SOGO department store.

12 years of dispute over the right to operate

In fact, the judgment of the Pacific SOGO department store has aroused great concern outside the world. Another reason is that the three sides of Zhang Min Qiang, Li Henglong and the Far East Group are grudges and resentment.

Historical data show that the Pacific SOGO department was established in March 1986, which is jointly operated by Pacific Construction and SOGO in Japan. Pacific Construction accounts for 51% of the shares.

This is also the first case of approved cooperative investment and operation of department stores in Taiwan.

However, after 2001, due to the impact of typhoon, the SOGO Department lost more than 200 million NT $once a week, and the cable TV business was not well managed, and the company was in financial crisis.

In this case, in May 2002, Zhang Minqiang, chairman of Pacific construction, was cut with SOGO department store.

Specifically, it invested 1000 NT dollars to set up a subsidiary of the Pacific Ocean Circulation and fully held SOGO department stores. At the same time, it registered the 60% stake in the Pacific Ocean Circulation to Li Henglong, vice chairman of Pacific construction.

Thus Li Henglong became a SOGO department store holder.

After completing the cutting, Zhang Min Qiang gradually lost control of SOGO department store, and then contacted the Far East Group and other companies to raise funds for the acquisition of SOGO department store.

This, instead, became the foreshadowing of losing SOGO department store in the future.

In September 20th of that year, Zhang Min Qiang was relieved from the post of director of Pacific circulation.

In September 21st, a temporary shareholders meeting was held in the Pacific Ocean, and 9 enterprises in the Far East group increased their capital by 1 billion NT $(then increased to 4 billion NT), thereby obtaining the right to operate SOGO department store from Li Henglong.

However, only one Li Henglong was present at the shareholders' meeting, and the provisional record of the meeting was also the top of the related enterprises in the Far East Group.

At the same time, the whole paction process involves the acquisition of the Chen Shuibian family offering 5000 million new Taiwan dollar political contributions, as well as the SOGO gift coupons as a gift, so the paction has a political color.

The insider trading of this series of pactions was exposed in a speech made by a legislator, which led to the case of SOGO operation right in the future.

In the next 10 years, Taiwan has detected the "case of the Pacific Construction hollowed out", "SOGO department store management case".

In 2009, the second instance of the "Pacific Construction hollowing" case overturned the first instance judgment, which ruled that Zhang Min Qiang was sentenced to 6 months' imprisonment, while the September 21, 2002 meeting records were identified as forgery.

In December 26, 2009, the Ministry of economic affairs of Taiwan's Gao inspection department announced that it would withdraw the registration changes related to the Pacific circulation.

This means that the capital increase of NT $4 billion and the absolute equity of SOGO department store will be regarded as invalid.

However, the Supreme Court of Taiwan finally rejected the appeal of the Ministry of economic affairs in May 9, 2013.

The Ministry of economic affairs subsequently resumed the registration of the Pacific circulation, and completed the registration of changes in September 18th.

At present, the number of shares circulated in the Pacific has increased to 802 million shares (8 billion 20 million capital NT), of which 600 thousand shares of Zhang Minqiang and Li Henglong have been lawsuits (600 NT $600), accounting for only 0.15% of the company's shares, while the remaining 99.85% are held by the Far East Group.

Now that Zhang Minqiang wins, the market thinks that it can not change the fact that shares are diluted.

Layout pformation of mainland department stores

Despite the fact that the Far East Group firmly grasps the initiative in the operation and control of the SOGO department store in the Pacific, the Pacific construction still disputes the ownership of the Far East Group in terms of specific operations.

It is understood that

It operates mainly in SOGO department store (SOGO Department Store) and Pacific department store in Taiwan and the mainland.

Among them, the Pacific Construction and the Far East Group have signed an agreement that the Far East Group is the sole legitimate user of the Pacific department store.

At present, the Far East Group has successively arranged Pacific department stores in Chengdu, Tianjin, Shanghai, Chongqing and Wuxi.

Among them, in December 1993, the first department store in the mainland opened the Pacific department store in Chunxi Road, Chengdu.

However, since the establishment of Beijing Jun Tai Department Store in the Pacific, several department stores that opened in the mainland have also used the name "Pacific Department Store", so the two sides have always been debated about the trademark.

It is worth noting that

Or Pacific construction, "Pacific Department Store" in recent years, there has been gradual decline in performance or even loss.

Take Beijing as an example, in 2007 and 2008, the Pacific department store Beijing Ying Ke Dian realized a profit of 12 million 800 thousand yuan and 6 million 800 thousand yuan respectively.

With the opening of Wukesong shop in 2009, the Pacific department store lost 16 million 410 thousand yuan in that year, and the 2010 loss reached 48 million 510 thousand yuan, becoming the only Pacific City Department losing money in the mainland every year.

Under the pressure of operating performance, in 2011, the Pacific Department Store announced the closing of its customers in two stores in Beijing. In October 2013, the Pacific department store in Chengdu, the first store in the mainland, also announced the closure.

For this time

Chao, the Pacific Department Store explained that "property rents are too high".

It is generally believed that there is a slowdown in economic growth, a slowdown in total retail sales and the rise of online shopping outside the department store. There is a serious problem in comparison with the fact that shopping centers are inadequate in their own capacity and there is a homogenization of competition among thousands of stores.

Data show that in the two quarter of 2014, China's online shopping volume accounted for 10% of the total retail sales of consumer goods.

So far, in the first half of this year, the scale of China's online retail pactions was 1 trillion and 150 billion yuan, an increase of 46% over the same period last year.

In contrast, in the first half of 2014, the overall sales growth of department stores continued to decline in the near two digit range.

In response to changes in the environment, the Far Eastern Group has announced that it will rename its Pacific department store as "Far East department store" and pform it to high-end.

Analysts believe that compared with the Pacific department store, the high-end brand or the company's performance has improved.