In the past two months, Stanley Ho Hung-sun's multiple transfers of billions of dollars worth of shares in SJM Holdings and Shun Tak to family members had only served to reassure investors that a succession plan was firmly in place and things were progressing smoothly.
That changed yesterday, after this newspaper reported Ho's allegations that the latest transfer - involving almost his entire remaining stake in his gaming empire - amounted to family members 'fraudulently misappropriating' his interests.
'We were reasonably pleased with how things were proceeding [with the share transfers], but obviously what's happened now has come as a bit of a surprise,' CLSA Asia Pacific gaming analyst Aaron Fischer said yesterday.
'I think there is a lot of confusion as to how this going to play out and I don't think anyone is expecting a quick resolution to it either, so it is potentially going to act as a drag on the stock in the short term,' he said.
Ho's lawyers are threatening legal action after his stake in Lanceford Co - the Hong Kong holding firm that controls most of his wealth - was diluted last month to 0.02 per cent from 100 per cent.
A massive issuance of new Lanceford shares on December 27 handed control of the firm to Ho's third wife, Ina Chan Un-chan, and the children of his second wife (Pansy, Daisy, Maisy, Lawrence and Josie).
Chan and the five children said yesterday that 'all of the material steps which led to the issuance of shares in Lanceford to Action Winner [controlled by Chan] and Ranillo [20 per cent owned by each of the five children] were approved or authorised in writing by Dr Stanley Ho'.
Control of Lanceford is tantamount to the control of the bulk of Stanley Ho's wealth, according to Gordon Oldham of Oldham, Li and Nie, Ho's lawyer. Ho was earlier this month ranked by Forbes magazine as Hong Kong's 13th-richest man with a net worth of US$3.1 billion.
Lanceford holds Ho's controlling 31.655 per cent stake in 50-year-old conglomerate Sociedade de Turismo e Diversoes de Macau (STDM). Alongside investments stretching from Vietnam to Portugal, STDM also owns a controlling 55.7 per cent in Macau casino operator SJM.
SJM suspended trading in its shares yesterday in response to the South China Morning Post article.
'The change in Lanceford's shareholding structure among Dr Ho and his family members has no significant effect on the overall ownership of the company ... The board is of the view that the Lanceford arrangement is a matter for the various members of Dr Ho's families to resolve and does not directly affect the company,' it said.
Ho is ranked Hong Kong's 13th-richest man with a net worth, in US dollars, of: $3.1b