A spat between an imprisoned billionaire and a senior business executive has spilled into the public arena, becoming a focus of nationalist sentiment and exposing the challenges of foreign investment in Chinese brands.

"My life is totally under threat and normal work has been seriously influenced," said Sun Yiding, vice-president of Gome Electronic Appliances Holdings. He claims he has been besieged by endless messages and phone calls from strangers calling on him to support Huang Guangyu.

Huang，who is in prison, is the founder and remains the largest single shareholder of Gome with a stake of 32.47 percent in the company. Before being sentenced to a 14-year stretch for bribery, China's youngest self-made billionaire used to be regarded as an idol by many because of his pioneering spirit.

The power tussle between Huang and Gome's current chairman, Chen Xiao, has turned into a nationwide debate since it broke out last month.

Last month, Huang sought the removal of Chen and three directors appointed by US equity firm Bain Capital LLC, claiming that Gome's performance had deteriorated under Chen's leadership. Gome's management, including Sun, most of whom were promoted by Huang, announced they would stand by Chen.

Last week, Huang said he may seek to sell 400 privately owned stores to the company to increase his stake. He retained personal ownership of part of the appliance chain's network when it listed in Hong Kong in 2004. The sale would increase Gome's outlets by about half and boost Huang's stake in China's second-biggest electronics retailer. Huang, who resigned from the board and was sued by Gome after his detention for economic offenses, is seeking to oust Chairman Chen and force the company to scrap a plan to sell shares that might dilute his stake.

Huang was ranked the second-richest person in China in 2008 by Forbes Asia, with an estimated fortune of $2.7 billion. He topped the Hurun Report's China Rich List that year with an estimated net worth of $6.3 billion.

Suggestions that Gome is being "Americanized" have also been stirred up on the Internet, after Chen received support from Bain when the equity firm announced it would exercise an option to take a 9.98 percent stake in Gome and vote for Chen Xiao at an upcoming special shareholders' meeting.

However, industry experts believe that with global economic integration, what matters most to shareholders, management and foreign investors is the brand's market value, not its nationality.

Sang Baichuan, a professor at the School of International Trade and Economics at the University of International Business and Economics (UIBE), said: "If a company established and controlled by Chinese people has more enterprises abroad than at home, we can't say the company contributes a lot to its own country other than that it satisfies an element of nationalist sentiment."

Gu Zhengping, a lawyer at Zhong Lun Law Firm, said: "According to Gome's financial statements, Gome is developing well under the leadership of the current management and is at least bringing benefits to all shareholders."

Gome reported first-half profit rising by 66 percent to 962.3 million yuan on strong consumer demand, enabling it to post its best performance since 2008. Huang claimed Gome's high profits came at the expense of closing many chain stores, causing Gome to lose market share and betraying most investors' original expectations.

Gome and its rival Suning currently operate 1,141 (including Huang's 400 privately-owned stores) and 1,075 retail outlets respectively across the country, each controlling 8 percent of the market, according to Everbright Securities.

Sources close to Huang claimed that Gome would be overtaken by Suning within two years under Chen's management. A difference in opinion on the way the company should develop caused the dispute between Huang and his successor. Ye Tan, a financial commentator, said in a blog that without peaceful coexistence, the power feud within the company would continue so long as shareholders and management hold different opinions.

However, Sang from UIBE, said he believed that behind the dispute on Gome's strategy was a battle for control of the brand. He said owning a valuable brand was a guarantee of stable revenues, especially if it had a near monopoly.

"Chen, Huang and Bain Capital all have a claim on the governance of Gome and have the right to open chain stores both in domestic and foreign markets using the Gome brand and sharing in its good recognition," Sang said.

Sang added that Gome was a locomotive for China's retail business, so it was normal that each party was striving to gain control of the company. They realized the value of intangible assets such as the Gome brand, which was central to the value of the company.

Currently, the investment market in China is oversupplied, so both domestic and foreign investors are striving to find a promising company with a good brand image to ensure strong returns, said Sang.

James Zhang, an investment banker, said, "Probably Bain originally intended to control Gome through buying convertible bonds and transferring them to an equity stake at a suitable time. It's not a conspiracy between Chen and Bain, as some netizens claim, because the final aim of a private equity firm is pursuing profits by controlling the company without involving personal emotions."

With an increasing number of foreign-invested projects, founders of Chinese companies have begun to realize the market value of their brands and the importance of managing them, said Sang from UIBE. Inciting people's nationalist sentiment was one of Huang's strategies to get support from the public to help him retain control of Gome.

"It's hard to judge each party on moral grounds, as each person is pursuing his own interests under normal business principles. Huang is exercising his rights as the largest shareholder to maintain his governance of Gome and Chen Xiao and Bain Capital are seeking more profits by wresting Gome's control from Huang," Sang added.

Sources close to Huang claimed it was unfair that a financial investor (Bain) that held a relatively small shareholding had such representation and influence over the company's board. Bain currently holds four positions on the board of Gome: three non-executive directors and one independent director. However, it is becoming a decision-making shareholder of Gome rather than just a financial investor.

The Boston-based private equity firm converted its 1.59 billion yuan bondholding in Gome into a 9.98 percent equity stake, becoming the second-largest shareholder of Gome and diluting Huang's holding in the company from 36 percent to 32.47 percent last Wednesday.

The bond conversion will give Bain more votes at the upcoming shareholder's meeting on Sept 28, when shareholders decide whether Chen and three executive directors representing Bain will remain.

However, Tang Jiarui, an analyst at Everbright Securities, expressed doubt about Bain's intentions at the special meeting, citing the famous remark by British wartime Prime Minister Winston Churchill, who said: "No permanent enemies, no permanent friends, only permanent interests."

Tang said: "For Bain Capital, the total asset value of Gome's listed and unlisted retail stores is very attractive."

According to Tang, Huang's wife Du Juan promised to put Huang's 400 privately-owned stores into the company's public section on condition that Bain stand by Huang at the special general meeting.

"Founding shareholders would welcome the opportunity to work with Bain, as Bain's interests would seem to be more aligned with that of all ordinary shareholders, after it converted bonds into ordinary shares," Huang declared in a statement released last week.

Tang believed that Gome's Sept 28 special general meeting was crucial to China's electrical appliances chain industry.

He said: "If Huang wins, he will expand Gome's market share by opening more retail stores in key areas. This will bring more difficulties to Suning's expansion plans. On the other hand, if Chen wins, Gome will probably be overtaken by Suning because of his strategy of improving profits at the expense of losing market share."

The struggle to control Gome between its jailed founder Huang and executives has stirred heated discussion among Internet users and experts. A survey at qq.com, one of China's most popular portals, attracted over one million Internet users. More than 879,000 Internet users, or 77.24 percent of the total voters, supported Huang, a Xinhua report said last Sunday.

Once the disparity between the two competitors' market shares increases, it will be very hard to recover the situation, Tang said. Meanwhile, investment banker Zhang said: "With the development of China's economy, there will be more similar commercial cases and Chinese entrepreneurs will also meet challenges from their management and foreign investors in their public companies."

Trying to balance the relationship with foreign investment was a new challenge for Chinese entrepreneurs, he added. Miao Liansheng, president of Yingli Solar Group, said that he maintained control of his company by keeping the stake of each foreign investor below 5 percent in the New York-listed company.

"Foreign investors are friends and we have good cooperation to develop Chinese companies into global industrial giants," he said. With the rapid growth of China's economy, foreign investment and management skills are needed by Chinese companies. With the growing size of their investment, overseas companies will be increasingly integrated with Chinese companies' operations, Sang from UIBE said.