Wang Shi, founder and chairman of China's real estate giant Vanke Co Ltd, announced on Wednesday he will step down and the company's president Yu Liang will take his place.
Experts said this move marks the end of a high-profile battle for control of the company, but concerns remain that its stock price is still sluggish.
On the heels of the announcement, Vanke's Shenzhen-listed shares increased by 1.52 percent on Wednesday morning, but closed at 21.04 yuan (.14), a gain of just 0.05 percent.
As the term of Vanke's current board has expired, its largest shareholder, Shenzhen Metro Group Co Ltd, on Monday proposed a list of nominees for its board of directors to be submitted to a shareholders meeting scheduled for June 30.
Three executives from Vanke are proposed to be included in the board and Yu Liang will become the head of the board. A graduate of Peking University, Yu joined Vanke in 1990 and has been its president since 2001.
On the nomination list, three executives of Shenzhen Metro are also proposed to be elected as non-executive directors, including its Chairman Lin Maode, General Manager Xiao Min, and Chief Financial Officer Chen Xianjun.
A surprise nominee is Sun Shengdian, chairman of Shenzhen Electronics Group Co Ltd, but no executives from Vanke's second and third-largest shareholders are listed.
Wang Shi posted a photo of him and Yu Liang on his WeChat Moments on Wednesday morning, with a caption reading, "When considering the change of the board, I have decided not to be nominated."
He also noted that "Vanke will enter a completely new development stage in the future and I believe it is the best time to pass the baton to Yu Liang's team, who are young but mature."
Wang established Vanke in 1984 in Shenzhen, Guangdong province, but in the beginning it was only engaged in trading and retailing business, according to Tencent News.
In 1988, Wang entered the property industry with the purchase of his first piece of land, and 24 years later Vanke became one of the largest developers in the world in terms of sales volume.
However, it has been stuck in a two-year long battle for control since July 2015, when Baoneng Group started to buy Vanke shares. Baoneng once even proposed to remove Wang from his leading position.
Shenzhen Metro then stepped in and became Vanke's largest shareholder earlier this month, holding almost 30 percent of the company's total shares. The State-owned railway company on Wednesday said it respects Wang's decision and hopes Yu Liang can lead Vanke to the top of the real estate industry.
"Vanke is about to have a period of close cooperation with Shenzhen Metro and the battle for control is finally coming to an end, a result that is positive for Vanke's development," said Ouyang Liangyi, associate professor at Peking University's HSBC Business School in Shenzhen.
He predicted that Baoneng, Vanke's second-largest shareholder, will choose to exit, but it is not easy.
"Shenzhen Metro is already the biggest shareholder so it is unnecessary to buy more. So who else will take it as the stock is already at a relatively high position?" he questioned.