There has been chaos at construction giant Hoa Binh Construction Group for the last two weeks, with its board of directors bickering over who the chairman is.
On December 14 the board had approved the resignation of chairman Le Viet Hai, effective January 1, and the appointment of outside director Nguyen Cong Phu as his replacement.
Hai’s son Le Viet Hieu was named CEO also from January 1.
Hai, who has a 17.14% stake in the company, claimed he would remain chairman of the Founders Committee, which would advise the board of directors and executives.
The decision had been approved by all eight members of the board, he said further.
But Phu dismissed these claims, telling the media that the Founders Committee does not have the authority to veto decisions made by the board.
Besides, Hai had to resign because some board members had discovered “financial wrongdoing” by him, he said.
“I told him ‘If you do not resign, we will call a board meeting and dismiss you.’”
Hai then fought back, calling for an extraordinary board meeting on December 29 to discuss postponement of the decisions approving his resignation, making Phu the new chairman and his son the CEO.
He told the Ho Chi Minh Stock Exchange (HoSE) that the decisions had to be postponed because there were issues with the operation of the Founders Committee.
Postponing these decisions would “strengthen the legal basis and firmly establish a new governance model” and “ensure the continuity of the company’s management at the time of the Lunar New Year,” he said.
“Changing the legal representative will create a bottleneck for payments and settlements.”
But four out of eight board members declined to attend the meeting, and five is the minimum quorum needed.
He convened an online meeting on December 31 with the same agenda, but again four members, Phu, Duong Van Hung, Le Quoc Duy, and Albert Antoine refused to participate.
But Hai went ahead, and the meeting minutes said five members were present by including Phu, who sent a message on the Viber chat group.
The meeting “approved” the postponement of the December 14 decisions, meaning Hai will remain chairman for now.
Phu described it as Hai’s desperate attempts to scuttle his appointment as chairman.
The postponement of the December 14 decisions are not legal, he told the State Securities Commission of Vietnam (SSC).
He needed to take over Hoa Binh to fix the problems caused by Hai’s poor management for years, he told the watchdog.
Hai had incurred “unreasonable” expenses on a subsidiary, he added.
Meanwhile, Hai told his employees in a note that Phu and the other members supporting him have an agenda of taking over the company.
Since January 1 both Hai and Phu claim to be the legal chairman of Hoa Binh.
Hai has said that only statements coming from him are valid.
Phu, in reporting the situation to the SSC and HoSE, said the board’s decision to make him the chairman was approved by all eight members.
VnExpress learned that Hai and Phu held a personal meeting on Tuesday, but no announcements have been forthcoming.
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