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Luckin Coffee’s board is forcing out its chairman (also, chairman is forcing out the rest of the board)

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Luckin Coffee’s board is forcing out its chairman (also, chairman is forcing out the rest of the board)

Sometimes you possibly can’t simply get a [L]uckin’ break.

After saying this morning that it’s ending its struggle to remain listed on Nasdaq, China-based espresso chain and supply firm Luckin Coffee introduced that it’s requiring that its chairman, Lu Zhengyao, resign in a submitting with the SEC.

Luckin Coffee will unluckin’ly delist from Nasdaq following fraud allegations

It additionally introduced in its SEC submitting that the chairman has requested the firing of unbiased director Sean Shao by way of a shareholders decision, which shall be voted upon at a shareholders assembly to be held on Sunday, July fifth.

My god.

It’s getting ugly at Luckin, which is struggling to turnaround within the aftermath of revelations of a $300 million accounting fraud that has seen its inventory value plummet in latest months. Shao has been main the board’s unbiased investigation over the accounting irregularity.

Luckin Coffee’s board initiates investigation into $300M potential fraud

Now, at a shareholders assembly, the board shall be up for grabs, with buyers within the firm (sure, there are nonetheless buyers!) selecting who to maintain and who to fireplace in a devolving case of company governance run amok.

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In addition to voting on a number of present administrators of the corporate, shareholders may even vote on putting in two new unbiased administrators, Zeng Ying and Yang Jie, who’ve long-time enterprise and authorized backgrounds.

We had beforehand recognized in regards to the extraordinary shareholders assembly, however now the corporate has upped the ante, by voting to pressure out the chairman by July 2 — three days earlier than the shareholders assembly is scheduled to happen.

Honestly, at this level, it’s unimaginable to say what comes subsequent. But what I can say is that Luckin is at present buying and selling down 54% at shut this Friday, and is value barely just a few hundred million {dollars} — down from its peak market cap of over $12 billion. Wh ever wins goes to personal some actually empty cups.

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