Chen readies herself for battle

China Development Financial Holding Corp (中華開發金控) chairwoman Diana Chen (陳敏薰) yesterday surprised rival shareholders by resorting to convenience-store chain Niko Mart Co's (福客多) more than 300 outlets nationwide to collect letters of proxy in her bid to hold onto the reins of the company.

Yesterday also marked the first day for Chen and her foe KGI Securities Co (中信證券) to officially kick-off their campaigns of proxy solicitation.

According to a company statement, China Development sent invitations to an April 5 shareholders' meeting to its 600,000 individual shareholders yesterday morning.

Upon receiving the invitation, shareholders who decide to give Chen their proxy votes, will be entitled to pick up a note for the company's annual giveaway at a nearby Niko Mart store and redeem the note for a NT$1,200 coffeemaker between March 27 and the end of July.

Shareholders who decline to give Chen their votes will have to pick up their coffeemakers at the shareholders' meeting on April 5.

The arrangements, therefore, are expected to help Chen since many small shareholders may hastily relinquish their proxy votes just to take advantage of the convenient way to collect their gifts.

List submitted

Determined to retain her management team, Chen yesterday submitted her list of candidates to the Securities and Futures Institute.

Chen recommended a total of 11 candidates and three supervisory board candidates, most of whom are alleged to be her family members or former chairman Liu Tai-ying's (劉泰英) cronies.

On her candidate list Chen included her uncle Chen Ming-hsiang (陳明祥), Rock Hsu (許勝雄), chairman of Compal Electronics Inc (仁寶電腦), Wang Ying-chieh (王應傑), head of the Small and Medium Business Association and representatives from other re-investment companies affiliated with her family-run Lilontex Corp (理隆纖維).

Her candidates for the supervisory-board, which is supposed to play an independent role, Chen recommended three family members -- her father, Lilontex chairman Chen John-yi (陳重義), another uncle, Chen Chong-ching (陳重慶), and her younger sister, Chen Ming-wei (陳敏薇).

With only a less than 1 percent stake in China Development, Diana Chen has vowed to fill five seats at the company's new 21-member board on April 5.

Compared to the list of board candidates jointly recommended by KGI and the Ministry of Finance last Friday, "Chen's list, comprising most family members, is likely to disadvantage her campaign of proxy solicitation" at the upcoming board-reshuffle, said George Wu (吳裕良), an analyst at Primasia Securities Co.

Professionalism

Wu said that professionalism should be the priority for China Development to nominate new board members, but Chen's list has "more family connections, and less professionalism."

On the KGI recommendation list, the only Koo member is KGI president Angelo Koo (辜仲瑩), although the remaining candidates are also affiliated with KGI and the finance ministry, yet considered to be professionals in the banking, accounting and legal sectors, Wu said.