MOEA to settle Wu brothers Shinkong spat

TAICHUNG, Taiwan, The China Post Staff

The Ministry of Economic Affairs (MOEA) said yesterday it could take a couple of weeks to settle the dispute over who is the legitimate chairman of Shinkong Synthetic Fibers Corp. It said the two Wu brothers in the dispute may take the case to court if they disagree with the MOEA ruling. Shinkong, set up by Shinkong Group founder Wu Ho-su in 1989, is traded on the Taiwan Stock Exchange and has 3,000 employees and 150,000 shareholders. The dispute arose from the intensified fight over the Shinkong chairmanship between two of Wu’s four sons. Wu Tung-liang, who is incumbent chairman of both Shinkong Synthetic and Shinkong Financial Holding, refused to surrender the chairmanship to his younger brother Wu Tung-sheng, who was designated by a meeting of the Wu family to take over the position as chairman. The family meeting was chaired by Wu Kui-lan, widow of the group founder, with three of her sons attending. The mother and the three brothers reasoned that Wu Tung-liang can have a full play with his Shinkong Financial Holding Co. and should relinquish his position at Shinkong Synthetic to his younger brother Tung-sheng. Another reason was that Shinkong Financial Holding has already acquired Taiwan Securities, which used to be chaired by Tung-sheng. However, Tung-liang, who attended the family meeting, refused to accept the decision. He stressed that the operations of Shinkong Synthetic, a public company, should not be dictated by family members. He thought it would be in the best interests of the employees and shareholders if he continues serving as chairman at Shinkong Synthetic. Yet Wu’s mother managed to replace two board directors of Shinkong Synthetic with her two sons to hold a board meeting late last week to unseat Tung-liang and vote Tung-sheng as new chairman. Tung-liang, holds an MBA degree from University of California at Los Angeles, refused to hand over the position and challenged the legality of the board meeting. Both sides subsequently held press conferences to blame the other side. They also forwarded relevant corporate documents and minutes of meeting to the MOEA’s Department of Commerce (DOC). DOC officials said it normally takes less than three days to verify the applications to change the registrations for corporations and senior executives. But in view of the complexity involving the Shinkong Synthetic case, it could take about one or two weeks to verify the submitted materials become coming up with a conclusion on which of the Wu brothers should be the company’s chairman. If any of the Wu brothers does not accept the MOEA ruling, the officials said, he may take legal actions for settlement at the court. Sources said that Tung-liang challenged the decision by his mother and other brothers because he was not invited to the family meeting. He had sought to meet his mother alone to discuss the issue, but the mother would not see him unless other brothers are also present. Tung-sheng, also known as Eric T. Wu, graduated from both the Harvard Law School and Harvard Business School. He used to serve as chairman of Taiwan Securities Co. and Taishin International Bank of the Shinkong Group. He is concurrently a legislator representing the Taiwan Solidarity Union. The Shinkong Group is one of the largest business conglomerates in Taiwan with extensive operations in the field of banking, securities, insurance, textiles, petroleum gas, construction, and real estate development. Shinkong Wu Ho-su Memorial Hospital in Shihlin of Taipei was established in memory of the group founder.