Wahaha succession turmoil: Zong Fuli resigns from the group's position, possibly due to questioning by the State-owned Assets Supervision and Administration Commission of Shangcheng District

Nearly 5 months after the passing of Zong Qinghou, the founder of Wahaha, Wahaha, which is in the midst of corporate succession, is facing unexpected changes.Recently, a letter titled "Letter to All Employees of Wahaha Group" has been circulating on the internet. The letter, dated July 15th, was signed by Zong Fuli. The content of the letter indicates that some shareholders of Hangzhou Wahaha Group Limited (referred to as "Wahaha Group") and the People's Government of Shangcheng District, Hangzhou, have raised questions about the rationality of the group's operations since the passing of Zong Qinghou. As a result, Zong Fuli has decided to resign from the positions of Vice Chairman and General Manager of Wahaha Group effective immediately, and will no longer be involved in the group's operations.The circulated letter from Zong Fuli to all employees of Wahaha GroupCurrently, Zong Fuli has delivered the aforementioned resignation letter to Wahaha Group and all its shareholders, urging the relevant parties to act responsibly, promptly follow the procedures stipulated in the articles of association to reappoint a general manager, and have them fulfill the management responsibilities to ensure the normal operation of Wahaha Group and legally safeguard the common interests of Wahaha Group, customers, and all employees.On July 18th, when Time Weekly reporters sought verification from relevant persons at Wahaha regarding the authenticity of the above-mentioned document, there was no response by the time of publication. On the same day, when Time Weekly reporters called the headquarters of Wahaha Group, the staff answering the phone said they were not clear about the situation and suggested that reporters consult the group's media department. In response to this news, one of the shareholders of Wahaha Group, Hangzhou Shangcheng Wenshanlü Investment Holdings Group Co., Ltd., told the media, "We are also not aware of the specific situation. If there is any news, Wahaha will make an announcement."On February 25th of this year, Zong Qinghou, the founder and chairman of Wahaha Group, passed away at the age of 79 due to ineffective medical treatment. Subsequently, Zong Fuli, the only daughter of Zong Qinghou, who has been serving as Vice Chairman and General Manager of Wahaha Group since 2021, has successively taken over positions in related companies of the Wahaha Group.Public information shows that Zong Fuli currently serves as the legal representative in 29 existing companies under the Wahaha Group, of which she has been the legal representative in 23 companies since April of this year. At the same time, Zong Fuli has invested in 15 companies under the Wahaha Group, with 12 of them holding shares since March 2024.Furthermore, public information indicates that Zong Qinghou is still the legal representative of nearly 60 companies under the Wahaha Group.In the aforementioned internal letter, Zong Fuli mentioned that there have been no changes in the legal representatives and equity structure of Wahaha Group. Public information shows that currently, the legal representative of Wahaha Group is Zong Qinghou, with shareholders being Hangzhou Shangcheng Wenshanlü Investment Holdings Group Co., Ltd., Zong Qinghou, and the grassroots trade union joint committee of Hangzhou Wahaha Group Limited, holding 46.00%, 29.4%, and 24.6% of the shares, respectively. Hangzhou Shangcheng Wenshanlü Investment Holdings Group Co., Ltd. is a wholly-owned subsidiary of Hangzhou Shangcheng State-owned Capital Operation Group Co., LtdHowever, as a brand with annual sales exceeding 50 billion RMB, the entire Wahaha business is relatively diversified, with many businesses not directly managed by the Wahaha Group.According to a report by Time Weekly, currently, Wahaha Group has invested in several large companies, with a 39% stake in each, including Hangzhou Wahaha Food Co., Ltd. (registered capital of 240 million RMB), Hangzhou Wahaha Health Products Co., Ltd. (registered capital of about 200 million RMB), Hangzhou Wahaha Beverage Co., Ltd. (registered capital of 130 million RMB), and Hangzhou Wahaha Hongzhen Packaging Co., Ltd. (registered capital of 110 million RMB).Currently, the major shareholder of the above companies is Hangzhou Wahaha Hongzhen Investment Co., Ltd. (referred to as "Hongzhen Investment"), and Zong Fuli has been the legal representative of Hongzhen Investment since March this year, with 100% ownership of Hongzhen Investment. This means that Zong Fuli has control over most of Wahaha's business. In addition, since February 2024, Zong Fuli has successively taken up positions in 70 Wahaha-related companies.Furthermore, as early as 2007, Zong Fuli served as the president of Hongsheng Beverage Group, which was established in 2003 to undertake the processing business of some Wahaha products. Subsequently, under Zong Fuli's leadership, Hongsheng Beverage attempted brand incubation and launched the fruit and vegetable juice brand "KellyOne" targeting the high-end market in 2016.Taking Zhejiang Wahaha Industrial Co., Ltd. as an example, the company controls multiple companies including Zhejiang Wahaha Drinking Water Co., Ltd. and Shanghai Wahaha Drinking Water Co., Ltd. Currently, the shareholders of the company are Hangzhou Wahaha Chenzhen Investment Co., Ltd., which is 100% controlled by Zong Qinghou, and the employee stock ownership plan, with no state-owned shares.According to media reports, on July 18th, a person close to Wahaha revealed that several senior executives of Wahaha had left recently, but refused to disclose more information. A former senior executive of Wahaha confirmed the authenticity of this matter