Lenovo refutes rumors of Liu Chuanzhi’s 100 million annual salary: what’s going on?

On the evening of October 8, Lenovo Group’s IPO review status on the Science and Technology Innovation Board changed from “accepted” to “terminated”. Previously, on September 30, Lenovo Group’s IPO application on the Science and Technology Innovation Board was accepted, or it was the fastest company in the history of the Science and Technology Innovation Board to withdraw its listing application. This incident has caused heated discussions in the market. Earlier media reports said that Liu Chuanzhi received an annual salary of US$3.17 million in Lenovo Group, a Hong Kong-listed company, and his annual salary in 2020 was as high as 76.035 million yuan. According to the exchange rate calculation, this means that Liu Chuanzhi, who has retired for nearly 2 years, has about 1 billion annual salary.

On October 10, Lenovo Group (00992.HK) issued an announcement explaining that it had withdrawn its application for listing on the Science and Technology Innovation Board. It stated that after submitting the listing application materials, considering the scale and complexity of the company’s business, the financial information in the prospectus may expire during the review process of the application. At the same time, after careful consideration of the latest issuance and listing and other relevant capital market conditions, the company decided to withdraw the application for listing and trading of China Depository Receipts on the Science and Technology Innovation Board.

On the afternoon of October 12, Legend Holdings responded that the online rumor that “Mr. Liu Chuanzhi’s salary of about 100 million yuan after retirement” is seriously inaccurate. In addition, on December 31, 2019, Liu Chuanzhi retired from Legend Holdings and no longer served as the company’s director and management. He is the company’s honorary chairman, senior consultant, and member of the Strategy Committee. Starting from 2020, Mr. Liu Chuanzhi will no longer be from Legend Holdings. Receive job remuneration, including salary, bonus, medium and long-term incentives, etc.

According to previous announcements of Lenovo Group, Liu Chuanzhi’s total compensation from 2017 to 2019 was 36.73 million, 40.61 million, and 76.03 million respectively. Among them, the total compensation in 2019 is much higher than previous years, because Legend Holdings paid Liu Chuanzhi a one-time pension of 25.26 million yuan. According to the financial report, as of December 31, 2019, Liu Chuanzhi’s salary of 76.03 million includes salary of 16 million, discretionary bonus of 21.6 million, medium and long-term incentives of 11.43 million, pension of 25.26 million and other benefits of 1.73 million. In the subsequent 2020 annual report of Legend Holdings, Liu Chuanzhi was no longer in the executive sequence, and Liu Chuanzhi’s specific pension amount was not disclosed.

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