"Mattress King" Xiliming, 100 million yuan of funds mysteriously disappear

(Source: Shanhai New Finance)

Wholly owned subsidiary Xitu Technology illegally transferred 1.97B yuan, exposing governance and financial control flaws at Xilimen Company.

Xu Fanlin, Fu Shanshan | Text

On March 28, Xilimen Health Sleep Technology Co., Ltd. (hereinafter referred to as “Xilimen”) issued an announcement regarding the illegal transfer of funds from the company’s controlling subsidiary account and the protective freezing of some bank accounts, attracting market attention.

The announcement shows that the bank account funds of Xilimen’s subsidiary Xitu Technology Co., Ltd. (hereinafter “Xitu Technology”) were illegally transferred, with the total transferred amount reaching 100 million yuan. After investigation, the company found that relevant personnel are suspected of abusing their positions to illegally embezzle company funds. The company has applied for case filing and investigation with the public security authorities on March 26, 2026.

After the incident, the Shanghai Stock Exchange quickly issued a regulatory work letter, involving the company’s directors, senior management, and actual controllers.

As of the disclosure date, the amount of funds illegally transferred from Xilimen’s subsidiary bank accounts was 100 million yuan, with approximately 900 million yuan under judicial protective freeze, totaling over 1 billion yuan, accounting for 26.54% of the company’s latest audited net assets and 42.69% of the company’s latest audited monetary funds.

Xilimen stated that the company has quickly carried out a self-inspection of fund safety, strengthened the fund security control system, communicated with relevant parties, actively negotiated the return of the transferred funds, and cooperated with public security authorities to handle the case investigation, aiming to recover the transferred funds as soon as possible and eliminate security risks in company accounts.

On March 30, Shanhai New Finance contacted Xilimen and Xitu Technology to learn about the progress of the incident. A relevant person from Xilimen said that the matter is being processed, and the specific progress is not yet clear. As of the time of writing, Xitu Technology’s phone was unanswered, with no reply received.

01

Layout of hotel engineering

Xilimen’s official website shows that the company was founded in 1984, with over 40 years of history. It is China’s first listed company in the mattress industry, with business covering more than 70 countries and regions worldwide. Its products and solutions are widely used in homes, hotels, apartments, and diverse commercial scenarios, serving many international hotel groups and key engineering projects, forming a complete ecosystem from R&D, manufacturing to global service.

It is worth noting that Xilimen developed from a family workshop and remains a typical family-controlled listed company. The current actual controller, 64-year-old Chen Ayu, shares governance with his son Chen Yicheng, forming a “father-son leadership” structure. Core positions are held by trusted personnel of the actual controller, with family influence permeating all decision-making and operations.

The 100 million yuan illegally transferred funds involved Xitu Technology, a wholly owned subsidiary established by Xilimen in January 2021, with a registered capital of 50 million yuan, located in Xiaoshan District, Hangzhou.

According to annual report information from Tianyancha, the number of insured employees at Xitu Technology in 2021 was 64, but this number has continued to decline, with only 8 employees remaining. Multiple roles per person and full responsibility concentrated in few individuals are notable features, relying on trust to manage funds.

In terms of business positioning, Xitu Technology is not an ordinary subsidiary but a core strategic platform for Xilimen’s hotel engineering channel, responsible for developing and expanding hotel channel business.

Public information shows that Xilimen’s hotel engineering channel has entered partnerships with InterContinental Hotels, Marriott International, Jinjiang Hotels, Huazhu, BTG Hotels, Dongcheng Group, Shangmei, Atour, Kaiyuan Hotel Group, Junting Hotel Group’s Junlan Resorts, among others, with over 3,000 partner hotels, making it a significant growth driver for the company.

02

Subsidiary sales expenses account for 90%

Ninety percent of sales expenses are allocated to subsidiaries and can be autonomously managed, revealing a financial loophole at Xilimen.

According to Xilimen’s 2025 semi-annual report, the group has monetary funds of 1.44B yuan, with the parent company holding 5.5B yuan, a difference of about 530 million yuan; from 2021 to 2024, this difference ranged between 540 million and 870 million yuan. This indicates that subsidiaries hold a large amount of idle funds, and the over 1 billion yuan illegally transferred and frozen this time is the period when Xilimen’s subsidiaries had the most accumulated funds in recent years.

Looking at sales revenue, in 2024, Xilimen’s sales revenue was 4 billion yuan, with sales expenses of only 157 million yuan; meanwhile, all subsidiaries combined had sales revenue of 4.7 billion yuan, with total sales expenses exceeding 1.7 billion yuan, accounting for over 90% of the company’s total sales expenses.

Xitu Technology, a subsidiary with only 8 employees, has over 100 million yuan in on-hand funds, accounting for about 20% of all subsidiaries’ total monetary funds and 200% of its registered capital.

Some analysts pointed out that the embezzlement of 100 million yuan from Xitu Technology reveals a serious flaw in the company’s fund supervision. Large transfers usually require approval from the CFO, general manager, or even the board of directors, rather than being operated independently by a single person. On the other hand, the structure of Xilimen’s sales income and expenses may be related to the subsidiary’s significant autonomy in expenses and fund management.

This incident of fund embezzlement by a subsidiary exposes deep-seated issues in Xilimen’s subsidiary management, fund allocation, and internal control systems. It may also constitute a major defect in internal financial reporting controls.

According to the “Guidelines for Internal Control Audit of Enterprises,” an unqualified opinion on internal control audit is only issued if there are no major deficiencies and the audit scope is not limited. As Xilimen is about to disclose its 2025 annual report on April 25, this incident will pose a dual challenge for audit and internal control.

Notably, as of March 31, Xilimen’s stock price has fallen for seven consecutive trading days, with a total decline of over 23%, and its current market value is 5.502 billion yuan.

Regarding the recovery of funds, Xilimen stated that the recovery of illegally transferred funds is uncertain. If the funds cannot be recovered, it may adversely affect the company’s net profit.

On-duty editor: Su Zhiyong

Editor: Ma Lin, Xu Huiqing