tycoon puts chinese mantra 'lose a little to win a lot' to the test
Call it the Chinese tycoon's game theory: A famous Chinese saying says one needs to lose small money before one can win big bucks.
Chinese Estates controlling shareholder Joseph Lau Luen-hung apparently relied on this morsel of wisdom in his dealings with the famous hedge fund, Children's Investment Fund Management (TCI).
Two months ago, Mr Lau agreed to sell $1.73 billion of Chinese Estates shares at $8.30 each, then used half of the sale proceeds to increase his stake, buying shares at between $9.69 and $10.45 each - so out of character for a savvy businessman who lived on the mantra 'buy low, sell high'.
What gives? Well, blame it on TCI. At end-February, the London-based fund bought $1.7 billion of Chinese Estates shares, mostly from Thomas Lau - Joseph's brother and the company chairman - at $8.33 each.
'You need to lose big money before getting even bigger money,' said Joseph Lau, adding that 70 fund management firms were now much more interested in Chinese Estates after the TCI buy-in.
With yesterday's $10.65-a-share closing price, we'll give Mr Lau the benefit of the doubt just this once.
rotten job, but lau's got to do it
Still on Joseph Lau, reporters have noted a new title on his business card: chief executive. This was a bit of a surprise as Mr Lau, one of Hong Kong's high-profile playboys, usually prefers to keep a low business profile.
Asked by a brave reporter about the change, Mr Lau replied: 'Nobody really likes to do this job, right? So I take it up because I do everything for the company.' Does this make Joseph his brother Thomas' keeper?
all's well that ends well for Tien
The dust seems to have settled for MTR Corp's 'merger' with KCRC. With the former poised to fully take over the KCRC, one person who should feel relieved is KCRC chairman Michael Tien Puk-sun, whose contract expires this year.
'Today, I feel very relaxed - because the minister and chairman Chien answered all the questions for me,' said Mr Tien, referring to Secretary for Financial Services and the Treasury Frederick Ma Si-hang and MTR chairman Raymond Chien Kuo-fung.
All's well that ends well?
nice pay rise, if you can get it
China's richest couple - Gome chairman Wong Kwong-yu and his wife, Du Jian - made a combined 2.86 million yuan last year. Mr Wong's salary was up 55 per cent to 1.96 million, while his better half's pay was up 271 per cent to 0.9 million yuan.
BOC Hong Kong chief executive He Guangbei made $7.02 million, up 63 per cent, much higher than the 12 per cent profit growth his bank recorded last year. His deputy, who is not among the board of directors, made over $5 million, with the other two banking executives making between $4.5 million and $5 million. Nice work if you can get it.
analysts play the numbers
What is the hottest profession in China? Try chartered financial analyst. According to the CFA Institute, there are 7,785 candidates sitting for the professional exams this year, up 13 per cent from the previous year. In terms of the number of examinees, China is third behind the US (41,879) and Canada (10,161). Hong Kong is fourth with 7,504 - up 7.5 per cent annually - higher than Britain's 6.839. Hong Kong currently has 3,051 CFA members - five times China's 603 tally.
a little bounty for a lot of mutiny
What do you get a when you combine a school class and a ferry trip around the harbour? Mutiny on the Bounty. A joint venture between Hong Kong Ferry and the Chung Ying Theatre, the lesson Mutiny offers students for $180 each, is a quick course in politics.
'The students are already linking it to events, like the KCRC saga,' business development director Elaine Chung said.
Watch the vidcast at podcasting.scmp.com.