The Xiamen Lin family is navigating turbulent times.

On the evening of April 8, an official announcement revealed that Lin Kechuang, General Manager of Sanan Optoelectronics Co.,Ltd., had been placed under residential surveillance. He is also the brother-in-law of Chairman Lin Zhiqiang. The two men are of similar age and both joined the core management team in 2017.

Seventeen days prior, Lin Xiucheng, the founder of Sanan Optoelectronics Co.,Ltd., was the first to be placed under surveillance.

Subsequently, shares held by the Lin family's Sanan Electronics and Sanan Group in the listed company were judicially frozen. The combined frozen stake amounts to 29.47%, with a market value exceeding 17 billion yuan.

With both his father and brother-in-law embroiled in controversy, Lin Zhiqiang, the operator of the family business, must stabilize the situation.

In late March, he appeared alongside Lin Kechuang to announce a plan for joint share acquisitions over the next six months, with a maximum investment of 50 million yuan. The current challenge lies in smoothly advancing multiple projects already underway, representing a total investment of over 35 billion yuan.

Regarding core project issues, repeated calls to the company's board secretary went unanswered after connection. Silence can also be a form of response.

Lin Kechuang is a key figure at Sanan Optoelectronics Co.,Ltd..

Following the announcement of the founder's detention, he attended a press conference in late March as General Manager with the management team to address key concerns.

"Sanan Optoelectronics Co.,Ltd. has held in-depth discussions with suppliers, clients, and cooperative financial institutions, all of whom have expressed their support. Current production, operations, and management are all normal," Lin Kechuang stated.

He emphasized that Lin Xiucheng had not been involved in the daily management of the listed company for many years, and that this incident pertains solely to the actual controller himself and is unrelated to Sanan Optoelectronics Co.,Ltd..

Half a month later, Lin Kechuang himself became involved in the controversy, placed under residential surveillance by the Chongqing Yuzhong District Supervision Commission.

"We have not received any documents regarding an investigation into the company or requiring our cooperation in an investigation," Sanan Optoelectronics Co.,Ltd. responded, adding that relevant work arrangements have been properly handled, the board operates normally, and production, operations, and management remain normal.

However, this rational attempt at distancing cannot change the fact that Sanan Optoelectronics Co.,Ltd. is fundamentally a Lin family enterprise.

Lin Xiucheng, who built the empire, is from Anxi County, Quanzhou. He once topped the list of Xiamen's wealthiest individuals. On the 2026 Hurun Global Rich List, Lin Xiucheng and his son Lin Zhiqiang ranked third among Xiamen's listed wealthy with a fortune of 16 billion yuan.

In 2017, he proactively handed over leadership to the second generation. His eldest son, Lin Zhiqiang, serves as Chairman; his younger son, Lin Zhidong, is a Director and Deputy General Manager; and his son-in-law, Lin Kechuang, serves as Vice Chairman and General Manager.

Although he passed on the reins, Lin Xiucheng occasionally made public appearances.

As the head of Sanan Group, the indirect controlling shareholder of Sanan Optoelectronics Co.,Ltd., he delivered a speech at the company's 25th-anniversary meeting in early February, looking towards the future.

The detention of the actual controller and the General Manager has dealt a heavy blow to the stock price.

From March 23 to the close on April 9, the share price of Sanan Optoelectronics Co.,Ltd. fell by 28%, wiping over 23 billion yuan from its market capitalization.

Amid the turmoil, the second generation is striving to stabilize morale, specifically highlighting progress on one project: Chongqing Sanan-STM.

This is a joint venture, with Sanan holding a 51% stake.

In June 2023, Sanan Optoelectronics Co.,Ltd. partnered with STMicroelectronics to build a factory in Chongqing with a total investment of approximately 23 billion yuan. The aim is to establish China's first mass production line for 8-inch automotive-grade silicon carbide power chips, with the main product being automotive-grade electronic control chips.

STM is a significant player, being one of Europe's largest semiconductor manufacturers. Lin Xiucheng was also present at the signing ceremony.

The silicon carbide epitaxial wafers and chips produced by Sanan-STM are exclusively sold to STM. The line was activated in February 2025, just 16 months after commencement, with an initial capacity of 2,000 wafers per month. Upon reaching full production, annual capacity is expected to reach 480,000 wafers, with full capacity projected for 2028.

Management revealed that the project has entered the volume production stage and "will impact the global silicon carbide market."

What does 480,000 wafers per year signify? Sanan Optoelectronics Co.,Ltd. estimates this could meet over 40% of domestic demand for automotive-grade silicon carbide.

Sanan-STM is a critical element of the Lin family's转型 (transformation).

Sanan originally produced LED chips, which utilize semiconductor materials. Lin Xiucheng, looking ahead, recognized that compound semiconductor materials not only emit light but also offer advantages like high frequency, high speed, and high power, making them excellent materials for next-generation high-performance microwave communications and energy conversion.

Consequently, Sanan moved into the integrated circuit field, transforming from a single LED chip manufacturer into a compound semiconductor empire.

The Lin family is heavily investing in third-generation semiconductor materials, betting on the future, with a focus on two key directions: silicon carbide and gallium nitride. Particular emphasis is placed on the layout for silicon carbide.

Simultaneously, silicon carbide materials find applications in emerging fields like AR glasses. 8-inch and 12-inch silicon carbide wafers can yield 4 and 10 lenses respectively after cutting. The AR glasses market is expected to provide vast growth potential for semi-insulating silicon carbide substrates.

Management believes AI/AR glasses will become a new growth driver for the silicon carbide business.

Leading the family business through this transformation is not easy for Lin Zhiqiang.

Company announcements indicate an expected net loss of 200-300 million yuan for 2025, which would be the first annual loss since the company's backdoor listing.

Sanan attributes this to a further increase in the proportion of high-end LED products, improved revenue scale and profitability in the IC business, but losses dragged down by the filter and silicon carbide businesses.

Amid its transformation, Sanan often undertakes large-scale capacity expansions.

A review of its major investment projects highlights three key ones:

The Hunan Sanan Silicon Carbide Semiconductor Industrialization Project has a planned total investment of 16 billion yuan. Upon reaching capacity, it will support an annual output of approximately 360,000 wafers. As of June 2025, cumulative investment exceeded 18.5 billion yuan, yet it has not turned a profit, recording a net loss of 140 million yuan.

The Hubei Sanan Mini/Micro Display Industrialization Project involves a total investment of 12 billion yuan. As of June 2025, 3 billion yuan had been invested, with a net profit of 88 million yuan.

The Chongqing Sanan Semiconductor Silicon Carbide Substrate Project is a supporting project for the joint venture with STM. With a total investment of 7 billion yuan, over 900 million yuan had been invested by the end of June, awaiting further capacity release.

These three projects alone represent a total investment of 35 billion yuan, funded mostly with the company's own capital.

The detention of the actual controller and the General Manager has intensified the challenges of this rapid expansion.

At the press conference, management stated that Sanan Group has implemented multiple countermeasures. These include establishing a "Risk Disposal Task Force" with a plan led personally by top group leaders, and actively seeking strategic partners to introduce capital.

The Lin family awaits a solution to break through this difficult situation.