Zhang Yong, the billionaire co-founder and chairman of Haidilao International Holding Ltd., sold 47 million shares of the company for $350 million. This block trade, which was not publicly announced beforehand, led to an 8.7% decline in Haidilao's stock price, its largest drop in over a year.
The sale was executed at HK$58.60 per share, representing a 6.2% discount to Monday's closing price. This is the second time in recent years that Zhang, who together with his wife still controls a majority stake, has reduced his holdings in the hotpot chain. The previous sale in August 2021 also resulted in a significant stock price dip.
The unexpected sale has fueled speculation about management's confidence in the company's future, especially as Haidilao's shares had recently rebounded by 23% from a low in May. Analysts at Citi attributed the sharp decline to market disappointment over the insider selling, suggesting it indicates a lack of positive outlook from management. This sentiment could impact investor confidence in the company's growth trajectory and its ability to sustain recent gains.
