(Yicai) June 24 -- Xiaomi’s co-founder has clarified that he will use the proceeds from his recent sale of shares in the Chinese tech giant for charitable donations.

The Xiaomi shares Lin Bin sold are of a foundation he established in 2019, so he did not break the commitment he made in 2020 not to reduce his stake within five years, Lin, who is also the Beijing-based company’s vice chairman, said on social media platform Weibo on June 22. The foundation’s assets are solely for charitable and educational research donation purposes, he noted.

Between June 4 and June 6, Lin sold 10 million Xiaomi shares for HKD179 million (USD22.9 million), according to data from the Hong Kong Stock Exchange. This news resulted in many investors criticizing Lin for breaking his commitment and lacking credibility.

On April 17, Sun Yat-Sen University announced that Lin and his wife had donated CNY100 million (USD13.8 million) to their alma mater.

Regarding the discrepancy between the donation to SYSU and the value of the shares sold earlier this month, Lin explained that the foundation will donate the remaining amount to other philanthropic causes in the future.

Xiaomi’s shares [HKG: 1810] were trading down 2.8 percent at CNY17.68 (USD2.27) as of lunch break today. The stock soared to a record high of HKD35.90 in January 2021 but then significantly declined until October 2022, when it rebounded. It has gained 20 percent since the company’s first electric car hit the market on March 28.

Lin co-founded Xiaomi with Lei Jun in 2010 and previously served as the company's president. Since its inception, Xiaomi has rapidly achieved commercial success. Established as a smartphone maker, the firm later expanded to produce other handsets, personal computers, electronic appliances, and cars.

Editors: Tang Shihua, Futura Costaglione