La Scala developer vows to fight Macau land grab

PUBLISHED : Monday, 18 June, 2012, 12:00am
UPDATED : Monday, 18 June, 2012, 12:00am
 

Hong Kong developer Chinese Estates said last night it planned to take legal action to 'strongly' fight Macau government moves to nullify land transfers involving its luxury residential project La Scala, following alleged corruption by its chairman Joseph Lau Luen-hung.

The company also said it was 'determined' to pursue compensation claims against the Macau government and the five Macau firms involved in the transfers if the land transaction was invalidated.

In an announcement to the Hong Kong stock exchange, Chinese Estates said it had been told late on Friday that Macau's chief executive, Fernando Chui Sai-on, had given the go-ahead.

The Macau government started the procedure to invalidate the land purchase after its disgraced former public works chief, Ao Man-long, was found guilty of accepting a HK$20 million bribe to secure the land for developers.

The land was sold to Moon Ocean, a company previously owned by Steven Lo Kit-sing and now owned by Lau's Chinese Estates. Macau's Court of Final Appeal heard that Ao received HK$20 million from the two tycoons in 2005.

On Friday, Moon Ocean was given 15 days to submit a written objection to the Macau government.

Chinese Estates said it was seeking legal advice and 'intends to make a submission strongly opposing the decision proposed to be made by the Macau government', referring to the planned land sale invalidation.

It also said Moon Ocean would not rule out the possibility of appealing against or challenging any final decision of the Macau government.

The La Scala project had already sold 300 flats prior to Ao's latest trial.

Chinese Estates said last night that it might consider cancelling agreements with buyers of La Scala flats and refunding deposits.

The developer had suspended construction work and presales of the La Scala project pending a final decision by the Macau government.

Ao, who was already serving a jail term of 28-and-a-half years following two previous convictions, was sentenced to 29 years' jail, to be served concurrently, for corruption and money laundering.

Lo and Lau face charges from the Macau government for alleged corruption and have yet to stand trial.

$2.8b

How much, in Hong Kong dollars, Chinese Estates has invested in the La Scala project.

-La Scala will eventually have 4,000 flats

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