Investor Wu leaves Dotcom's Mega board

  • 13/07/2015
Investor Wu leaves Dotcom's Mega board

By Paul McBeth

Mega's biggest shareholder, Shen Zhao Wu, has left the board of the file storage and encryption firm and transferred his stake to a Beijing-based Chinese national just days after a constitution re-write made it easier to go public.

Meanwhile, Auckland businessman William Yan has increased his influence over the company after an entity linked to his wife took a small shareholding.

Mr Shen, a donor to the National Party through his Contue Jinwan Enterprise Group, ceased being a director of Mega on July 8 after sitting on the software developer's board for just over a year, according to documents lodged with the Companies Office.

Two days later, his near 26 percent stake in the company transferred to Beijing-based Li Zhi Min, who is now Mega's biggest shareholder.

Mr Shen increased his stake in Mega in a share issue amounting to 6.7 percent of the company in February.

Mega also added a new shareholder to its register on July 10, with LY Investment No 1 taking a 1.9 percent stake.

LY Investment's sole director is Wei You, the wife of William Yan, whose assets were frozen as part of a joint New Zealand and Chinese police investigation into an alleged money laundering ring.

Mr Yan's existing 16 percent stake in Mega, via TEY Trustee Ltd, is subject to the freeze, and he has denied the allegations levelled against him.

LY Investment acquired the stake from Cloud Innovations, an entity whose sole director and shareholder is Filipino actress Asia Agcaoili, the wife of Bram van der Kolk, Mega's chief programmer.

Mega filed a new constitution to the Companies Office on July 6, adding specific provisions for listing the company, and stating that the "board shall take all reasonable steps to prepare the company for listing on a recognised stock exchange" while setting share sale restrictions for a maximum 12 months from the date of joining a bourse unless the board determined otherwise.

In May, the Auckland-based company aborted plans to list on the NZX via shell company TRS Investments after a series of delays in gaining approvals.

Mega was launched by internet entrepreneur Kim Dotcom in 2013 to replace his Megaupload empire, which was frozen after his high profile arrest at the behest of the US federal government in early 2012. He has since stepped back from the firm to fight his extradition.