2.3 million in, 305 million out—a 132-fold return.

On August 11, 2026, an announcement by Shangmei Co., Ltd., a company listed on the Hong Kong Stock Exchange, sent the phrase “Zhang Ziyi cashes out 300 million” trending on social media. Comments quickly shifted from envy to skepticism—“Don’t let her get away” and “Check her taxes.”

But if you look at this deal beyond the gossip, it’s actually a lesson in equity structure worth tens of millions.

If you're a business owner who holds equity in your company and one day decides to exit—what truly determines how much you'll ultimately receive isn't how much you sell it for, but the structure you chose when you first invested.

I. Let’s first look at the transaction itself

Seller: Gongqingcheng Dajiao Investment Partnership (Limited Partnership); Zhang Ziyi holds a 99% stake, and her father, Zhang Yuanxiao, holds an 1% stake.

What’s for Sale: A 23% equity stake in Shanghai Yiye Biotechnology Co., Ltd. Shanghai Yiye is the operating entity behind “newpage—Yiye,” a functional skincare brand for infants and children, co-founded by Zhang Ziyi, parenting expert Cui Yutao, and former P&G Chief Scientist Huang Hu.

Purchased by: Shanghai Qingdao, a wholly-owned subsidiary of Shangmei Co., Ltd.

Transaction Consideration: Approximately 304.5 million yuan.

Timeline: In January 2022, Da Jiao Investment acquired a stake in Shanghai Yiye for approximately 2.3 million yuan, securing a 29% equity interest. Four years later, it sold 23% of that stake for 304.5 million yuan,A return of more than 131 times over 4 yearsThe

Following the completion of the transaction, Da Jiao Investment will continue to hold approximately 6% of Shanghai Yiye’s equity, and Zhang Ziyi will remain the brand’s spokesperson. The supplemental agreement also includes a provision allowing Shanghai Yiye to request that Shangmei repurchase an additional 5% of equity within the next five years, with a maximum consideration of 500 million yuan.

II. Wrong Architecture Choice Results in an Additional Cost of 60 Million

Many business owners engage in equity investments and casually register a limited liability company as a holding vehicle, thinking, “It’s my own company anyway.” But the difference in tax liability between a corporation and a partnership when transferring equity is so significant that it might make you question everything.

Bigfoot Investment is a limited partnership. Under tax law, a partnership is referred to as a “tax-transparent entity”—it does not pay corporate income tax itself, but rather “passes through” its income to the partners, who then pay taxes individually. This is known as “distribution before taxation.”

Zhang Ziyi is a natural person partner; the income she receives is subject to individual income tax as “gains from the transfer of property,” at a tax rate of 20%.

Let's do the math:

But! If Zhang Ziyi had registered a limited liability company as a holding platform back then:

• At the corporate level, corporate income tax at a rate of 25% is paid first: 302.2 million × 25% ≈ 75.55 million
• After-tax profits are redistributed to individual shareholders, who pay 20% in individual income tax: (302.2 million – 75.55 million) × 20% ≈ 45.33 million
• Add the two figures together: 75.55 million + 45.33 million ≈ 121 million yuan
• The total tax burden is approximately 40%.

Using a Partnership vs. Using a Corporation:

Difference: approximately 60 million.

For the same 300 million, if you choose the right structure, the tax is 60 million; if you choose the wrong one, it’s 120 million.

III. However, this 60 million is only the first level of the saying, “Comparison is the root of all pain.”

If you think “setting up a limited partnership is the end of your worries,” you might be falling into a second trap.

According to a search of publicly available information by Bigfoot Investment,It has neither completed the filing as a venture capital firm with the National Development and Reform Commission nor filed as a private fund with the Asset Management Association of China.The

What does that mean?

Filing serves as a tax rate trigger. Only individual partners of venture capital enterprises that have been filed may choose to calculate taxes using the single investment fund method at a rate of 20%. For general partnerships that have not been filed, gains from the transfer of equity interests must be included in business income and are subject toThe five-tier excess progressive tax rate for 5%-35%The

300 million yuan falls directly into the highest tax bracket (35.1%) on the business income tax rate table. The tax liability is approximately105 million yuanThe

In other words.Even for a limited partnership, the tax burden differs by approximately 45 million depending on whether it is registered or not.

IV. Practical Advice for Business Owners

First.Architectural design should be done early on. The form of the equity holding platform, where it is registered, and whether it is on file—these variables that determine the tax burden are already set in stone the moment you invest. By the time you’re ready to exit, it’s too late to make changes.

Second.Don't casually register a company just to use it as a holding vehicle. If your goal is to hold equity and wait for an exit, a limited partnership is usually the better option.

Third.Registration is not optional. If the investment focus falls within the scope of venture capital, the filing process should be initiated simultaneously with the establishment of the entity. If it is merely a holding platform with no external investment activities, and the filing route is not viable, then tax costs must be factored into the calculations during the structural design phase.

Fourth, and most importantly—find a professional to do the calculations for you. Taxes aren’t based on “feelings”—they’re calculated. For the same transaction structure, different tax treatments can result in a difference of tens of millions.

📌 If you are considering exiting an equity investment or setting up a holding structure, we recommend conducting a tax assessment of the structure before initiating the transaction. We provide professional tax compliance services for equity structures, including the design of shareholding platform solutions, tax burden calculations, filing assessments, and exit strategy planning.Feel free to contact our customer service via WeChat:qcygscszk 📞 Phone: 18676749275, and we will arrange for a professional consultant to provide you with one-on-one assistance.

Disclaimer: This article is compiled based on the announcement issued by Shangmei Co., Ltd. on August 11, 2026, and publicly available reports. It is intended solely for financial and tax learning and analysis regarding publicly traded tax mechanisms and does not constitute tax attestation, agency services, or case-specific diagnostic advice. The specific tax categories, rates, and collection methods for equity transfers are subject to the determination of the competent tax authorities and the actual tax filing.