Actual Controller Lin Xiucheng Under Investigation; San'an Optoelectronics Hits Limit Down

On March 22, Sanan Optoelectronics (600703) (SH600703), a leader in LED and compound semiconductors, announced that its actual controller, Lin Xiucheng, has been detained and placed under investigation by the National Supervisory Commission.

The “Daily Economic News” reporter noted that Lin Xiucheng, the main strategist and core founder behind Fujian Sanan Group Co., Ltd.'s backdoor listing of Tianyi Technology Co., Ltd. (hereinafter Tianyi Technology) on the A-share market, has not held any position in the company for nearly nine years since he handed over the chairmanship to his eldest son, Lin Zhiqiang, in July 2017.

It is worth mentioning that yesterday (March 23), Sanan Optoelectronics’ stock price hit the limit down, closing at 14.89 yuan per share.

“Retired from the spotlight” for nearly 9 years

Sanan Optoelectronics stated that on March 21, 2026, it received a notice from Fujian Sanan Group Co., Ltd. (hereinafter Sanan Group), which recently received a notice from the National Supervisory Commission regarding the detention and investigation of the company’s actual controller, Lin Xiucheng.

This news came unexpectedly. A review of the company’s development history reveals that the individual who created Sanan Optoelectronics has actually been “retired from the spotlight” for nearly nine years.

Lin Xiucheng was born in Anxi County, Fujian Province. He holds a university degree and a senior economist title. He is not only the founder and major investor of Sanan Group and Xiamen Sanan Electronics Co., Ltd., but has also served as chairman of several holding subsidiaries.

Sanan Optoelectronics’ predecessor was Tianyi Technology. From 2004 to 2006, Tianyi Technology experienced losses for three consecutive years, and its stock was suspended from trading by the Shanghai Stock Exchange in May 2007.

During Tianyi Technology’s critical restructuring phase, Lin Xiucheng and his controlled Sanan Group stepped in forcefully. In 2007, Sanan Group successfully acquired 54.297 million legal person shares of Tianyi Technology. Through this, Lin Xiucheng gained control of Tianyi Technology.

Subsequently, Lin Xiucheng led a large-scale asset restructuring and share reform. Sanan Group injected Tianyi Technology with operational assets of its controlled subsidiary, Sanan Electronics, including LED epitaxial wafers and chips, through a share issuance to the listed company. This textbook-like backdoor listing revived Tianyi Technology, transforming it into a leading enterprise in the LED industry.

However, after many years at the helm of the listed company, Lin Xiucheng chose to “retreat quickly.” In June 2017, Sanan Optoelectronics held a board meeting chaired by Lin Xiucheng, where Lin Zhiqiang and others were nominated as non-independent directors for the ninth board. According to available information, Lin Zhiqiang is Lin Xiucheng’s son.

In July 2017, Sanan Optoelectronics held its first extraordinary general meeting of shareholders for 2017, with Lin Xiucheng presiding as chairman for the last time. At this meeting, Lin Zhiqiang was elected as a non-independent director of the ninth board. On the same day, at the first meeting of the ninth board, after recommendation by all directors, Lin Zhiqiang was elected as chairman of the ninth board.

Company’s performance forecast for last year shows losses

In response to the sudden event of the actual controller Lin Xiucheng being detained and investigated, Sanan Optoelectronics stated in its announcement that since July 10, 2017, Lin Xiucheng has not held any position in the company.

The company clarified that its production, operation, and management are currently normal. It has a complete organizational structure and a standardized governance system, and will continue to operate in accordance with the “Company Law of the People’s Republic of China,” the “Shanghai Stock Exchange Stock Listing Rules,” the “Guidelines for Corporate Governance of Listed Companies,” and other laws, regulations, and internal policies. The above incident will not have a significant impact on the company’s operations.

Despite emphasizing stable management and normal operations, it cannot be ignored that Sanan Optoelectronics is currently under significant pressure regarding its performance.

In January 2026, Sanan Optoelectronics disclosed its “2025 Annual Performance Forecast,” which, based on preliminary calculations by the finance department, estimates that the net profit attributable to shareholders of the listed company for 2025 will be between -200 million and -400 million yuan; and the net profit after deducting non-recurring gains and losses will be between -750 million and -850 million yuan.

Subsequently, Sanan Optoelectronics issued a supplementary announcement to the forecast. Further calculations by the finance department adjusted the expected net profit attributable to shareholders for 2025 from “-200 million to -400 million” yuan to “-200 million to -300 million” yuan.

Regarding the main reasons for the projected loss in 2025, Sanan Optoelectronics provided an explanation in the announcement.

The company stated that during the reporting period, the proportion of high-end LED products further increased; revenue and profitability of the integrated circuit business both improved year-on-year, but filters and silicon carbide businesses within the integrated circuit segment still heavily dragged on profits; government subsidies received decreased year-on-year; R&D expenses increased; sales of precious metal waste at the temporarily agreed prices diverged from Shanghai Gold Exchange prices, reducing investment income; and according to “Enterprise Accounting Standards,” provisions for inventory impairment were increased due to lower net realizable value compared to cost.

Regarding the detention and investigation of Lin Xiucheng, Sanan Optoelectronics said the company will continue to monitor the situation and fulfill its information disclosure obligations in a timely manner according to relevant regulations.

(Edited by: Zhang Yang HN080)