Gome’s founder was China’s richest man — then prison, and the company never recovered

Wong Kwong Yu founded GOME in 1987 and built it into China’s largest consumer electronics retailer. By 2007 his net worth was estimated at $6.3 billion, making him the richest person in mainland China. The company listed on the Hong Kong Stock Exchange in 2004 and was a Chinese retail powerhouse.

On 24 November 2008, Hong Kong police charged Wong with stock market manipulation. He resigned as chairman in January 2009. In May 2010 the court found against him, and the penalties against him and the company ran to hundreds of millions of dollars. The legal action triggered a power struggle between his appointed successor Chen Xiao and the detained founder, who directed a seven-month campaign from prison to reassert control. Chen Xiao resigned in April 2011.

GOME survived the crisis but lost its market leadership. Revenue fell from HKD 67.4 billion in 2019 with a net loss of HKD 2.9 billion. The company that had been China’s dominant electronics retailer was overtaken by JD.com and Suning. Wong was released on probation in June 2020 after his sentence was reduced for good behaviour, but GOME’s position in the market had long been overtaken by online competitors.