The business world never lacks variables, but integrity remains the foundation of survival.
Recently, Bestore Co.,Ltd. (603719.SH), a prominent company in the leisure snack industry, has been caught in a whirlwind of controversy. The company is not only facing operational difficulties due to continuous performance deterioration, but has also been embroiled in litigation disputes arising from alleged duplicate equity transfers by its controlling shareholder.
With the founding team eager to exit and capital partners who have accompanied the company for nearly 25 years turning away, this enterprise once hailed as the "first premium snack stock" is now facing dual challenges in both equity and performance.
**Duplicate Equity Transfer Triggers Litigation**
In the summer of 2025, Bestore's equity turmoil has intensified.
According to the company's "Progress Announcement on Controlling Shareholder's Litigation" disclosed on August 13, 2025, the Guangzhou Intermediate People's Court has accepted a lawsuit filed by Guangzhou Light Industry and Trade Group Co., Ltd. (hereinafter "Guangzhou Light Industry"). The dispute centers on alleged duplicate equity transfer actions by the controlling shareholder Ningbo Hanyi Venture Capital Partnership (hereinafter "Ningbo Hanyi").
The timeline shows that in May 2025, to alleviate debt pressure, Ningbo Hanyi signed an "Agreement" with Guangzhou Light Industry, stipulating that Guangzhou Light Industry would acquire partial shares after completing due diligence, and would enjoy priority purchase rights from the agreement signing date until May 28, 2025. The transaction price was set at the lower of either 12.42 yuan per share or 1.05 times the average price of N trading days before the formal agreement.
According to the announcement, Bestore's actual controllers Yang Hongchun, Yang Yinfen, and Zhang Guoqiang had confirmed the agreement content and issued personal consent commitment letters. However, on May 28, Ningbo Hanyi and its acting parties did not sign a formal agreement with Guangzhou Light Industry, leading to a stalemate.
Less than two months later, another twist emerged in the equity transaction.
According to the company's announcement on July 17, Ningbo Hanyi and its acting party Liangpin Investment signed a share transfer agreement with Wuhan Yangtze River International Trade Group Co., Ltd. (hereinafter "Yangtze River Trade"): Ningbo Hanyi intended to transfer 72.24 million shares (18.01% of total share capital), while Liangpin Investment intended to transfer 11.97 million shares (2.99% of total share capital), totaling 21% of shares. Yangtze River Trade is a 100% state-owned enterprise under Wuhan Financial Holdings Group. If the transaction is completed, the company's controlling shareholder would change to Yangtze River Trade, with the actual controller becoming Wuhan State-owned Assets Supervision and Administration Commission.
This move triggered strong dissatisfaction from Guangzhou Light Industry.
According to court acceptance information, Guangzhou Light Industry filed a lawsuit and applied for property preservation on July 14. Ningbo Hanyi's holdings of 79.76 million shares (56.46% of its shareholding) have been frozen. On August 13, Guangzhou Light Industry amended its litigation request, demanding that Ningbo Hanyi continue to fulfill the May agreement by transferring 79.76 million shares at 12.42 yuan per share (totaling 991 million yuan), while increasing the penalty from 5 million yuan to 31.70 million yuan (calculated at 0.05% daily of the total transaction amount from May 29 to July 31, totaling 64 days), and claiming preservation losses of 875,200 yuan plus legal fees of 50,000 yuan. The total amount involved in the case increased to approximately 1.023 billion yuan.
Bestore admitted in its announcement that while the litigation has not significantly impacted current production and operations, it may create "uncertainty risks" for Yangtze River Trade's control transfer. More notably, during the equity freeze period, the company's financing, mergers and acquisitions, and other major decisions may be restricted. Transaction counterparties may demand higher considerations or even abandon transactions due to equity uncertainty, undoubtedly adding pressure to already strained operations.
**Operational Pressure**
Behind the equity turmoil lies Bestore's increasingly severe operational reality. This enterprise that once established itself with the "premium snacks" label has fallen into a persistent performance decline in recent years, with core data showing its operational difficulties have entered a vicious cycle.
To address market competition, Bestore implemented price reduction strategies in store channels starting from November 2023.
According to company disclosures, the large-scale price cuts launched at the end of 2023 saw 300 products reduced by an average of 22%, with maximum reductions reaching 45%. In 2024, over 500 products completed price adjustments. The price cuts directly impacted gross margins, and according to Q1 2025 report data, the company's gross margin fell to 24.64%, significantly below previous levels.
However, price reductions failed to generate growth and instead accelerated store closures.
The company's total store count was 3,293 at the end of 2023, sharply declining to 2,704 by the end of 2024, with a net closure of 589 stores in one year (261 new stores added, 850 closed). "Losses" became the primary reason for closures, with 223 directly-operated stores and 366 franchise stores closing. By the end of Q1 2025, store count further declined to 2,581, equivalent to a net reduction of 1.37 stores daily, showing significant channel contraction.
Online channels were once placed with high hopes. In 2024, the company's e-commerce revenue reached 2.932 billion yuan, accounting for 40.95% of total revenue, becoming an important income source. However, according to annual report data over the years, e-commerce revenue has declined for three consecutive years since 2022, with continuously rising traffic costs compressing profit margins.
Under multiple pressures, company performance continued to deteriorate.
In terms of revenue, 2023 saw a 14.76% year-over-year decline, 2024 declined 11.02%, and Q1 2025 showed an accelerated decline of 29.34%. Net profit performance was even more dismal: 2023 net margin was 2.23%, 2024 net profit attributable to shareholders turned to a loss of 46.10 million yuan (net margin -0.69%), and Q1 2025 net margin further dropped to -2.1%. According to the H1 2025 performance forecast, the company expects net profit attributable to shareholders to be between -105 million yuan and -75 million yuan, with adjusted net profit between -130 million yuan and -100 million yuan.
The root cause of performance decline cannot be separated from dramatic changes in industry competitive landscape.
In recent years, discount snack stores represented by "Snacks Are Busy" and "Zhao Yiming Snacks" have rapidly emerged. The merged entity "Mingming Is Busy" has become a new industry giant. According to public data, Mingming Is Busy achieved GMV of 55.5 billion yuan in 2024 with nearly 14,400 stores, far exceeding Bestore's 2,500+ stores. Notably, Bestore once held a 3% stake in "Zhao Yiming" but transferred it to Black Ant Capital in October 2023. Just 22 days later, "Zhao Yiming" announced its merger with "Snacks Are Busy." The company later mentioned in announcements being "deliberately concealed and misled," but the fact of rapidly eroded market share could not be changed.
In industry competition, peers' efforts further highlight Bestore's passive position. Laiyifen built a 30-minute delivery network, Yanjinpuzi achieved growth by entering bulk snack retail channels, while Bestore not only saw its investment in Zhao Yiming end fruitlessly, but its self-built bulk store "Snack Player" also failed to meet expectations, clearly lagging in channel transformation.
Facing the crisis, the company was not without self-rescue attempts.
Large-scale reforms were launched at the end of 2023: founder Yang Hongchun resigned as chairman, and co-founder Yang Yinfen took over, promoting the largest price reduction in 17 years, but the strategy failed to reverse the decline. In March 2025, Yang Yinfen resigned and Cheng Hong became the new chairman; in April, Yang Hongchun returned as general manager. Frequent senior management changes reflect internal disagreements and uncertainty about strategic direction.
**Capital Withdrawal**
As equity disputes and operational difficulties intertwined, capital partners who had accompanied Bestore for years also chose to exit. According to the company's July 17 announcement, while controlling shareholder Ningbo Hanyi and its acting parties signed share transfer agreements with Yangtze River Trade, the second-largest shareholder Today Capital's subsidiary Dayong Limited transferred 8.99% of shares to Yangtze River Trade at 12.34 yuan per share, cashing out 445 million yuan.
Today Capital's exit carries symbolic significance.
As one of the earliest investors in Bestore, it became a "core" shareholder since 2010, holding 33.75% before listing. In February 2020, the company debuted on the Shanghai Stock Exchange main board as the "first premium snack stock," opening with a 44.03% surge. Today Capital founder Xu Xin appeared in A-share's first live-streamed IPO, enjoying momentary glory.
However, as performance declined, Today Capital began continuous reductions since May 2023. According to announcements, from May to November 2023, Dayong Limited cumulatively reduced holdings by 17.04 million shares, cashing out 404 million yuan; from January to February 2024, it reduced another 12.03 million shares, cashing out over 199 million yuan; combined with the July 2025 transfer of 8.99% shares for 445 million yuan, post-IPO cumulative reductions exceeded 24% of shares, with cash-out amounts exceeding 1.5 billion yuan. After this transaction, Dayong Limited's shareholding ratio dropped from 18.16% to 9.17%, showing clear exit intentions.
Hillhouse Capital "cut losses" even earlier.
Hillhouse's cooperation with Bestore began in 2017 during the leisure snack sector boom, holding 13% of the company pre-listing through multiple financing rounds, diluted to 11.67% post-listing. According to public data, Hillhouse began reductions after restricted shares were unlocked in February 2021: first round reduced 10.78 million shares, cashing out 456 million yuan; second round in October 2021 reduced 5.91 million shares, cashing out 239 million yuan; third round in May 2022 reduced 7.82 million shares, cashing out 219 million yuan. Three rounds of reductions totaled approximately 914 million yuan in cash-outs. As of March 31, 2024, Hillhouse's subsidiary HHLPPZ (HK) Holdings Limited held only 1.24%, essentially completing a clearance exit.
The collective capital withdrawal reflects both reactions to the company's persistent performance deterioration and concerns about future prospects. Hillhouse's rapid exit, beyond its own capital needs, relates more to the leisure snack industry's intense competition and declining growth characteristics; Today Capital's choice to reduce holdings after years of commitment obviously relates closely to the company's strategic unfocus and trust crisis triggered by equity disputes.
**Breakthrough Awaits Resolution**
From a market cap peak of 34 billion yuan to 5.5 billion yuan at closing on August 20, 2025, Bestore's market value has evaporated by over 28 billion yuan in just five years. The dispute over duplicate equity transfers not only creates uncertainty over company control but also consumes market trust; operational price cuts, store closures, and senior management turbulence have failed to halt performance decline; consecutive capital departures have made the transformation path even more challenging.
Bestore stated in its announcement that this equity transaction is "for the next decade's development, advancing core competitiveness layout," and introducing state capital is "strategic upgrading to proactively seek transformation in response to new industry development stages." As a large-scale international trade platform enterprise under Wuhan municipality, Yangtze River Trade's "supply chain + brand + channel" resources, if effectively integrated, might bring new possibilities to the company. However, against the current backdrop of unresolved equity disputes and continuous performance losses, realizing this vision is obviously fraught with uncertainty.
Ningbo Hanyi's duplicate equity transfer behavior not only violates commercial contract spirit but also raises investor and market doubts about company governance. For Bestore, resolving equity disputes and rebuilding market trust are far more urgent than simply introducing capital.
In the future, whether Bestore can clarify strategic direction after state capital entry, whether it can reposition its brand in a discount snack-dominated market, and whether it can regain investor confidence with stable performance returns, remain unknowns.
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