Sun Hung Kai Properties

'Sackings' to follow tycoon's forced leave

PUBLISHED : Wednesday, 20 February, 2008, 12:00am
UPDATED : Wednesday, 20 February, 2008, 12:00am

The sudden 'leave of absence' by Sun Hung Kai Properties chairman Walter Kwok Ping-sheung, linked to his friendship with a woman, may be followed by a shake-up of staff at the blue-chip developer, a source close to the situation told the South China Morning Post yesterday.

The insider said a number of staff appointed by the 57-year-old tycoon to please his 'female friend' may be fired in a minor shake-up.

The woman had not worked at SHKP, but had been exerting considerable influence on the chairman's business decisions, the source said.

The source said the family had not cared about the long-time relationship until the woman started to show ambition in taking over the firm's major business.

'She wanted to take over shopping malls and be put in charge of China,' the source said.

Unable to put up with the situation any longer, Mr Kwok's two younger brothers asked their mother, Kwong Siu-hing, to pass judgment in the family 'court'.

Ms Kwong was very angry and had forced the chairman to step down temporarily to break what was deemed an unhealthy influence over company matters.

Mr Kwok could return to the company once he had 'cleared his thinking', the source said.

'We will take this opportunity to clean up the company and fire [some] people.'

As widow of SHKP founder Kwok Tak-seng, and matriarch of the family, Ms Kwong holds the largest stake in the company through a family trust.

On Monday night, SHKP announced that Mr Kwok would take a 'temporary leave of absence for personal reasons', immediately sparking speculation about his health and personal affairs.

While some newspapers blamed his 'holiday' squarely on the chairman's alleged relationship with a woman, one Chinese-language newspaper suggested disagreements on investment projects might have led to his stepping aside.

Vice-chairman Thomas Kwok Ping-kwong and managing director Raymond Kwok Ping-luen will jointly assume their brother's duties.

The source also said that since Walter Kwok's supposed kidnapping in 1997 by Cheung Tze-keung, a notorious gangster known as 'Big Spender', his role had been reduced to the company's hotels business and some relatively less important projects.

The news of Mr Kwok's leave of absence has had little impact on investor sentiment in SHKP. The company's share price rose 60 HK cents to close at HK$140 yesterday, after hitting an intra-day low of HK$138.

The man at the centre of the drama has made no public appearance so far to explain the brief company announcement. It it is also not clear whether he will attend the company's interim results announcement on March 6.

Last night, however, SHKP made a further announcement, stressing that its business strategy, operations and senior management would remain unchanged. 'We hope to see no more speculation about Mr Kwok's temporary leave,' it said, adding that reports about the woman having worked for SHKP were untrue.