Huang Guangyu, the founder of retailer Gome and once China’s richest man, had vowed to revive his electronics empire after securing an early release from prison in 2020 for insider trading and bribery.
But while he was serving his 14-year sentence, China’s retail landscape irrevocably changed, with ecommerce titans Alibaba and JD.com rising to dominate the market and growth in the world’s second-largest economy slowing.
Huang, who owns a 53 per cent stake, is now fighting for his company to stay solvent. Gome has recorded five consecutive years of losses and ended 2021 with a Rmb4.4bn ($642mn) deficit, plus the same amount left in cash. Its auditors EY resigned last November over a pay dispute and, as the retailer shutters stores, staff said they had not been paid for months.