Gome's management battles its founder

Gome Electrical Appliances Holdings (493.HK) will hold a special meeting to face off challenges from its incarcerated founder, Huang Guangyu, the Financial Times reported. Huang, though arrested in 2008 and sentenced to 14 years in prison this May, retains a 34% equity stake in Gome, and has already managed to unseat temporarily three Gome directors who represent Bain Capital, a private equity investor in the company. Earlier this month, management revealed that Huang has requested a special meeting to conduct a vote on whether to replace the current chairman, Chen Xiao, and another board director with his sister and a business associate. While agreeing to the meeting, Chen defended his record of navigating turbulent times and staving off bankruptcy by raising large dollops of foreign funding. He said that Huang had been a destabilizing influence on the firm, and struck a populist note in an open letter to Gome employees.