Analysis of Wang Enwei Family's Control Over Fuen Co., Ltd.: A Study on Corporate Governance of a Family Business with 83.89% Aggregate Shareholding

Based on the collected public information, I provide you with a detailed analysis of the Wang Enwei family’s control over Fuen Co., Ltd.:

The actual controllers of Fuen Co., Ltd. are

[1][2], and the three form a concerted action group:

• Wang Neili
  : Daughter of Wang Enwei, spouse of Wang Xuelin
• Wang Xuelin
  : Spouse of Wang Neili, Director and General Manager of the company
• Wang Enwei
  : Founder of the company, father of Wang Neili

As of the signing date of the prospectus, the shareholding control by the Wang Enwei family is characterized by

[1][2]:

Control Method	Shareholding Ratio	Details
Direct Shareholding	42.40%	Wang Neili 27.43%, Wang Xuelin 8.57%, Wang Enwei 6.40%
Indirect Control	41.48%	Via Paiya Holdings (36.57%), Hangzhou Fenwei, Hangzhou Fuyun
Aggregate Control	83.89%	Direct + Indirect Methods

[3]:

• Wang Enwei held 43.34% of the shares
• Yinan Village Economic Cooperative held 41.67% of the shares
• It was nominally a village-run joint venture, but was actually controlled by Wang Enwei

[3]:

• Yinan Village Economic Cooperative transferred all its shares to Wang Enwei
• Wang Enwei took full control of the company

[3]:

• Wang Neili officially “took over” and assumed the position of Chairman from her father
• Wang Xuelin was promoted to Director and General Manager at the same time

In addition to the core concerted action group, the shareholdings of other family members are as follows[1][2]:

• Wang Neizhi
  : Youngest daughter of Wang Enwei, younger sister of Wang Neili, directly holds
  4.57%
  of the company’s shares
• Qiu Qinchao, spouse of Wang Neizhi
  : Not present in the company’s management or shareholder roster

Note: Although Wang Neizhi is a family member, she

does not form a concerted action group with the other family members

[3]

The Wang Enwei family enjoys highly concentrated interest distribution:

• 2022 cash dividends
  : RMB 381 million
• Dividend ratio for the family
  : Calculated at 83.88%, the family received
  over RMB 300 million in dividends
  [1]

Based on the above analysis, the control of the Wang Enwei family over Fuen Co., Ltd. is characterized by

:

Evaluation Dimension	Status
Shareholding Ratio	83.89% — exceeding the two-thirds absolute control threshold
Concerted Action	The three core individuals form a concerted action group
Management Succession	The transition from the founder to the second generation has been completed
External Investors	Limited introduction of external investors, only a small number of external investors such as Zhejiang Zhengkai, Chen Qiong, and XU QING[3]

Potential issues arising from highly concentrated control:

1. Risk of Related-Party Transactions
   : Zhengkai Group is both a customer and a supplier, suspected of interest transfer[3]
2. Protection of Minority Shareholders’ Interests
   : Limited speaking rights for external shareholders
3. Centralized Decision-Making
   : Major decisions are highly dependent on the judgments of core family members

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: The Wang Enwei family of Fuen Co., Ltd. has achieved over the company, with an aggregate control right of , which is a typical pattern of a family business with a dominant shareholder. Such a highly concentrated shareholding structure is relatively rare in corporate governance, and investors need to pay attention to potential issues such as related-party interest transfer and protection of minority shareholders’ rights and interests.

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[1] Sina Finance - “Deeply Tied to Uniqlo and H&M, Fuen Co., Ltd. Pursues IPO: Wang Enwei Family Receives Over RMB 300 Million in Dividends in a Year” (https://finance.sina.cn/2026-01-17/detail-inhhqpee0010284.d.html)

[2] Eastmoney - “Fuen Co., Ltd.: Shareholder is Both Customer and Supplier, Contradictions in Related-Party Transactions” (https://caifuhao.eastmoney.com/news/20251224212205706413010)

[3] Eastmoney - “Several Questions About Fuen Co., Ltd.” (https://caifuhao.eastmoney.com/news/20260108213141435342070)