Financially struggling Chinese sportswear retailer Li Ning said today CEO Zhang Zhi Yong had quit effective yesterday, and the company?s Olympic gymnast founder would become CEO until a replacement has been found.
Li Ning also announced today that private investment firm TPG, which took a stake in the company in January, had had one of its partners, Kim Jin Goon, named as executive vice chairman and executive director. Samuel Su, the CEO of the successful China business of Yum! Brands?and the vice chairman of Yum!?s board, will join Li Ning as an independent non-executive director, it was also announced today. ?
The moves come after Li Ning last month said it expects profit this year to show a ?substantial decline? amid an increase in marketing costs and a slump in revenue.
The company has been hurt by an industry-wide build-up of inventory and weak demand. Peak Sport Products, also one of China?s largest homegrown suppliers of sportswear, last Friday issued a warning that it expects net profit in the six months to June to ?decrease considerably.?? (See story here.) ??
Li, who will keep his job as executive chairman,?will ?focus on managing the external affairs and relationships? of the company, and Kim will lead the ?internal affairs and operations,?? the statement said.? Kim helped to improve the performance atTaiwan women?s footwear maker Daphne International (see related story here) after TPG investment in the company in recent years.
Li Ning?s shares have lost nearly two-thirds of their value in the past year; Peak?s are off by 75%. ?Nike shares fell in U.S. trading on Friday after the company missed profit estimates
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