Luckin Coffee replaced co-founder and (now ex) president Charles Zhengyao Lu, despite his efforts to maintain control of Beijing's troubled coffee chain. The company revealed on Monday in a SEC filing that Jinyi Guo, another co-founder, board member and former acting chief executive officer of Luckin, has been appointed new president and chief executive officer.
In the SEC filing today, Luckin also said that a total of four directors had left the board (Lu, David Hui Li, Erhai Liu and Sean Shao) and two new independent directors were appointed. The new additions are Jie Yang, vice-dean of the business school at the Chinese University of Political Science and Law, and Ying Zeng, who was a partner in the law firm Orrick Herrington and Sutcliffe and was previously Vice President and National Director of El Paso Corporation for China.
The company's disclosure comes after weeks of conflict during which Lu sought to retain control of Luckin. Earlier this month, an attempt by Luckin Coffee's the directors to remove Lu as chairman did not obtain enough votes at a meeting of the board of directors.
The proposal to oust Lu was made on June 26 after an internal investigation revealed that Luckin Coffee's net revenue in 2019 was inflated by about 2.12 billion RMB (300 million U.S. dollars) and that the Manufacturing transactions began in April 2019, with Lu, former chief operating officer Agent Jenny Zhiya Qian and several other employees participating in the false reports.
Luckin Coffee revealed last month that the Nasdaq had decided to deregister the company, a spectacular fall after having raised 651 million dollars in its public offer in the United States in May before allegations of fraud cause the fall of its actions .
