Dianhun Network Chairman to Transfer 3% Stake to Ex-Wife After Divorce

Hu Jianping, chairman of A-share game developer Dianhun Network, will transfer a 3% stake to his ex-wife Chen Fang following their divorce. The pair signed a 36-month concerted-action agreement to hold their combined 16.56% control steady.

The split comes as Dianhun, known for its long-running PC title Dream Three Kingdoms, faces a maturing game market and pressure on older titles. The arrangement is less a simple divorce settlement than a reallocation of power between the company's core operating business and its founders' outside investment holdings.

Hu will carve out 7.28 million shares — 3% of the company — to Chen through a non-trade transfer. His direct stake will fall to 2.78%, while hers will rise to 13.78%, nearly five times his holding.

Shared interests beyond the listed company

Corporate records show the former couple's interests remain intertwined well beyond Dianhun. According to Tianyancha, a corporate records database, Hu and Chen together hold 75% of Hangzhou Xinhuarui Network Technology Co., Ltd. — 45% and 30% respectively. The company was set up in April 2019; the other two individual shareholders, Li Lin and Wang Lejun, hold 15% and 10%.

That makes the separation a broader redistribution of power across both the listed business and the pair's private equity vehicles, not the usual case of a husband running the company while his ex-wife cashes out in the secondary market.

Chen was never a background figure

Chen held finance and investment roles at Dianhun early on, later served as a director and deputy general manager, and rose to general manager. She has long overseen the listed company's finances, outbound investment and day-to-day operations.

Even before the transfer, Chen directly owned 10.78% of Dianhun, already more than Hu's 6.50%. She is now the largest single individual shareholder in the controlling bloc, while Hu keeps the chairman's title.

Why a 36-month pact

The concerted-action agreement serves two purposes: compliance with tightened A-share rules on stake sales, and defence against hostile buyers.

Regulators have moved to block major shareholders and executives from using a "fake divorce" to cash out. Divorced controlling shareholders and their concerted parties must still combine their holdings when calculating sale quotas and follow the rules on block and auction trades. By locking in a three-year pact, the pair aim to show they are not dodging those limits and to head off panic selling.

Dianhun's dispersed ownership is the bigger concern. No shareholder holds more than 30%; Hu, Chen, co-founder Hu Yubiao and other founders have relied on concerted action to keep relative control. After the split, Hu and Chen together control just 16.56%. Without the agreement, a cash-rich game company trading near the bottom of its valuation cycle could be vulnerable to outside capital or rivals building a stake on the open market.

Deeper cracks: one IP and strategic risk

A three-year truce can freeze short-term governance risk, but it cannot close the gaps in the core business. Dianhun has long depended heavily on the Dream Three Kingdoms franchise. Tencent dominates mobile MOBA games in China, and younger players are shifting toward anime-style titles, mini-games and open-world games, weighing on revenue from older PC and mobile titles.

Volatile earnings and gross margins already require management to make firm calls on heavy in-house development spending versus cost cuts. If the former partners disagree on major acquisitions, projects costing tens of millions of yuan, or dividend policy, decisions once settled by trust will turn into hard commercial bargaining.

A three-year countdown

The shared stake in Xinhuarui shows the couple's outside assets are not fully separated either, leaving a longer chain of bargaining over money. The market's real worry is not the calm announcement but what happens when the 36 months expire — when Chen, with close to 14%, and Hu, with under 3%, face the question of who ultimately controls the company.