This is the third time this year that Meituan co-founder Mu Rongjun has reduced his holdings in Meituan

Meituan co-founder reduces his shareholding in the company.

On October 3, according to information disclosed by the Hong Kong Stock Exchange, Mu Rongjun, co-founder, executive director, and senior vice president of Meituan, sold 2 million shares at an average price of HK$171.8055 per share on September 30, for a total of approximately HK$344 million. After the reduction, the number of shares held is approximately 56.31 million shares.

This is already the third time this year that Mu Rongjun has reduced his shareholding. In April, he reduced his shareholding twice, totaling 2 million shares.

According to Meituan's mid-year report for 2024, as of June 30, 2024, Meituan had a total of 6.221 billion issued shares, including 597 million Class A shares and 5.625 billion Class B shares. According to the mid-year report, Mu Rongjun held 80.72 million Class A shares at the time, accounting for 13.53% of the total shares, and 31.92 million Class B shares, accounting for 0.57% of the total shares.

The annual report shows that Mu Rongjun is a co-founder, executive director, and senior vice president of Meituan. At the age of 44, he is responsible for financial services and corporate affairs. Mu Rongjun has over 15 years of management and operational experience in the internet industry.

Before co-founding Meituan, he worked as a senior software engineer and project manager at Baidu from July 2005 to May 2007. Mu Rongjun is also a co-founder of Fanfou and served as the company's technical director from May 2007 to July 2009.

According to Taimedia, executive stock options are part of a pre-IPO share incentive plan. According to relevant regulations, pre-IPO stock incentives must be exercised near expiration and sold on the open capital market to exit. Meituan went public on the Hong Kong Stock Exchange in September 2018, and the options granted before the IPO are approaching expiration.

Relevant sources indicated that this transaction involved options that were likely granted a long time ago and that this was likely the first time Mu Rongjun has exercised them since they were granted. It is a normal financial exercise process for the founder and accounts for a very small proportion of his personal shareholding. Overall, this transaction is part of personal financial planning, with the options nearing expiration and accounting for a very small proportion, and does not involve any attitude towards the company's future. The market should not overinterpret it.