Recently, Smart Share Global Ltd, known as the "first shared power bank stock," has sparked market concerns about minority investor losses after rejecting Hillhouse Capital's $1.77 per ADS (American Depositary Share) privatization offer in favor of a lower $1.25 per ADS proposal.

Industry insiders suggest that Monster Charging's acceptance of the lower privatization offer may be due to "a profit distribution arrangement more favorable to management." However, the company has yet to provide any public explanation or disclosure regarding this controversy.

Notably, during the privatization process, Monster Charging's core business - mobile device charging services - has experienced significant decline over the past year. Additionally, the company's previously maintained "number one" position in the power bank market has begun to waver.

Xu Mu (pseudonym), a channel representative from a Monster Charging competitor, revealed that "Monster Charging's proactive sale of direct-operated power bank stores last year affected partner confidence, leading some agents who previously exclusively handled Monster's equipment to actively expand into non-Monster power bank brand businesses."

**Low-Price Privatization Sparks Controversy, Minority Shareholders' Interests May Be "Damaged"**

Recently, Monster Charging filed a 13E3 document with the U.S. Securities and Exchange Commission (SEC), announcing that the board formally rejected Hillhouse Capital's $1.77 per ADS premium privatization offer made in August, continuing to pursue the $1.25 per ADS privatization plan with a consortium comprising Xinchen Capital and management.

Monster Charging's insistence on low-price privatization while rejecting Hillhouse Capital's obviously superior offer has generated widespread controversy. Industry lawyers point out that this behavior "is difficult to justify as serving the principle of maximizing all shareholders' interests." Some minority investors worry that under the low-price privatization scheme, "their interests may not be adequately protected, requiring them to bear potential losses from the failure to reflect control premium in the stock price."

"Clearly colluding with capital to harm small shareholders," one online commenter stated bluntly. Meanwhile, Monster Charging management's capability and integrity have also come under widespread questioning. An industry professional in the power bank sector directly stated: "Perhaps their executives and the low-price privatization institution have agreed on a profit distribution arrangement that's more favorable to management, hence this decision."

However, as of publication, Monster Charging has not responded to inquiries or provided any public explanation regarding these controversies and investor concerns.

**Power Bank Performance "Halved," Agent "Confidence Weakened"**

The analysis reveals that amid the controversy, Monster Charging's 2024 annual report showed that the company's core mobile device charging business (i.e., "power bank" business) experienced significant decline in 2024. Power bank business annual revenue was 1.385 billion yuan, down over 51.72% year-on-year compared to the previous year's 2.869 billion yuan, with core business performance nearly halved.

Alongside the significant decline in core business, Monster Charging's total 2024 annual revenue also showed notable decline, with total revenue of 1.894 billion yuan, down 35.99% year-on-year, declining over 1.065 billion yuan from 2023's 2.959 billion yuan. Simultaneously, the company's gross profit has declined consecutively for multiple years, from 2.265 billion yuan in 2022 to 803 million yuan in 2024.

In Xu Mu's view, the decline in Monster Charging's power bank business revenue stems primarily from decreased product competitiveness and the company's abandonment of direct operations among other management strategy adjustments, which intensified agents' weakened confidence in Monster Charging products, leading them to switch to other competitive systems.

Last August, Monster Charging was exposed for large-scale sales of city direct-operation businesses, fully transitioning to agent franchise models. According to Monster Charging internal sources: "Except for premium locations in core cities like Shanghai and Chengdu that remain operational, direct-operation locations in other cities have been packaged for sale and transferred to regional agents."

According to Xu Mu, during this adjustment, Monster Charging's proactive abandonment of direct operations caused partner panic, leading some ten-thousand-unit scale Monster Charging agents to begin contacting competitors like Meituan power banks and Zhumang, no longer putting all eggs in one basket. "Among our agents, a large number come from Monster Charging, with at least 1/4 of agents simultaneously handling Monster and other competitor businesses, and last year many of their agents approached us for cooperation discussions."

Interestingly, beyond agent confidence shaking, it appears Monster Charging's entire management team's confidence in the company's power bank business is also weakening.

In the 2024 annual report released in late April, within the 161-page annual report (excluding consolidated financial statement details and independent auditor reports), Monster Charging devoted 54 pages to in-depth analysis of risks facing company development. Throughout the financial report, one rarely sees the company's "confidence" and fighting spirit for future development, but rather more "crisis awareness" and "lack of confidence."

Monster Charging frankly stated: "The company has experienced net losses in the past and may be unable to achieve or maintain profitability in the future." It further pointed out that "the company's strategic transition to network partner models (i.e., full transition to agent franchise models) may not succeed."

**Industry Competition Intensifies, "Number One" Position Wavers**

According to iResearch's "2024 China Shared Power Bank Industry Research Report," the domestic shared power bank industry currently has high concentration, with the top five brands accounting for 96.6%. As of the end of 2023, Monster Charging had the highest market share at 36%. From a transaction scale perspective, Monster Charging's GMV exceeded 4 billion yuan, ranking in the industry's first tier.

In communications, multiple shared power bank agents directly stated that since late last year, Monster Charging's "industry number one" position has changed.

"Currently, in the power bank market ranking, Meituan is first, Monster is second," a Monster Charging power bank agent stated directly. Although no professional reports or testing data currently confirm this market change, checking power bank mini-programs through WeChat and Alipay reveals that whether looking at Alipay's "recent usage" or WeChat's "friend usage," Meituan power banks have comprehensively surpassed Monster Charging.

Taking Alipay's "recent usage" as an example, Meituan power banks had over 4 million recent users, while Monster Charging had 2 million+, approximately half of Meituan's. From WeChat mini-program usage review volume, users participating in Meituan power bank usage reviews also number several times those of Monster Charging.

In Monster Charging's 2024 annual report, the company also candidly stated: "We operate in a highly competitive industry, and our competitors may compete more effectively than us, which could adversely affect our operating performance and financial condition" and "Some of our potential competitors hold leading positions in other industries and may enjoy significant competitive advantages, and there can be no assurance that we will be able to compete successfully with current or future competitors."

"Industry competition is increasingly fierce now. Locations that could achieve 60 yuan daily revenue last year can only reach 50 yuan this year, and regions like Beijing have begun implementing per-minute billing. Major power bank manufacturers are also frantically shipping and deploying, making the industry increasingly competitive with decreasing profits," industry insiders believe. Beyond internal management and product quality issues, Monster Charging currently faces challenges from competitive pressure caused by "intensified industry competition."

**Who Pays for Minority Shareholders' "Potential Losses"?**

Against the backdrop of increasingly competitive industry conditions, Monster Charging management's pursuit of privatization and delisting seems to signal the company's lack of "full confidence" in future development. However, behind the insistence on low-price privatization, who will pay for the potential interest losses that minority shareholders may incur?

According to public information, Monster Charging's management collectively holds 16.9% of company shares but controls 64% of supervoting rights. Under such governance structure, parties holding supervoting rights are typically strictly required to fulfill fiduciary duties and protect all shareholders' maximum interests.

However, Monster Charging's management chose to use supervoting rights to form a consortium with Xinchen Capital attempting to privatize the company at a relatively low price. This behavior has also triggered opposition from minority shareholders. Some Monster Charging shareholders have publicly stated that "management's low-price privatization actions have depleted investment institutions' trust, and future overseas litigation cannot be ruled out."

As investors who once weathered difficulties and developed together with Monster Charging, minority shareholders' rights should not be ignored.