China’s beauty products e-commerce site Jumei announced yesterday a full acquisition of power bank rental startup Ankerbox, which led to its investor’s openly criticizing the move and calling out the company for full responsibility for the debacle over the past 18 months.
Jumei’s investor Heng Ren Partners released an open letter earlier this week, pointing out that Jumei has suspended any meaningful communication with shareholders for 22 months and “the more than $59 million invested in these questionable non-core targets is equal to 12% of Jumei’s market cap, and 18% of its cash.”
The firm also asked Jumei to distribute a special dividend of $1.50 per share, totaling $225 million. The letter suggested that during the past 18 months, the market valuation of Jumei has slumped by $397 million.
In response to all the doubts, Jumei responded last evening that the company has closely followed SEC regulations, regularly released the corporate’s annual report and maintain proper and effective communication with the investors.
In addition to e-commerce related businesses, the Chinese firm has been investing broadly in film and television firms and power bank rental startup. It fully acquired Ankerbox three months after the online retailer purchased a controlling 60% stake in the company for RMB 300 million (US$ 45 million).
The Shenzhen-based startup Anerbox is a top player in China’s power bank rental sector, and operates in first- and second-tier cities, claiming over 1 million daily users.