Kuok now a step closer to home

ROBERT Kuok Hock Nien's proposed venture into the world of newspapers and publishing through the purchase of a 34.9 per cent interest in South China Morning Post (Holdings) Ltd would add yet another business to the long list of interests he has built up since launching his first company in Malaysia 46 years ago. His latest deal, which - according to a statement issued in Australia by News Corporation, major shareholders in SCMP - is subject to negotiations with Hong Kong's regulatory authorities, comes at a time in his life when other men think of slowing down. In May, Mr Kuok, then 69, indicated his seat was now at the back of the boardroom, and that his sons, Khoon Chen and Khoon Ean, would be doing the steering. But giving up must be hard after having been the main decision maker for so long. Mr Kuok began the construction of his corporate base in 1947. He had already entered the traditional family business of soft commodities - rice and sugar - after the war against the Japanese, but expanded into groceries and shipping. Today the Kuok interests extend throughout the region. There is still retailing and shipping, but the portfolio now includes hotels - the Shangri-La chain - mining, chemicals, retailing insurance and property. Control of most can be traced back to the Kerry Group of companies, the intensely private umbrella under which the Kuok interests shelter. In China, Kuok companies have emerged as one of the major direct investors in property and hotels. But they have also become involved in vegetable oils and oil refining. Among the most recent developments by Kerry, which sum up the opening of China to outside culture as well as investment, are a series of joint venture bottling projects with Coca-Cola. Mr Kuok is hardly the barefoot emigre made good. His family moved down to Johor from Fujian, but his father, Kuok Yam Kam, had done well enough in the commodities business for his son to attend the highly rated Raffles Institute in Singapore. One of his classmates was an ambitious Chinese called Lee Kuan Yew. Back in the family business after the war, the Kuok son showed he had the right business instincts, and by the mid-60s had emerged as a major force in the sugar business - the locals dubbed him the Sugar King. It was in this business that the Chinese would have first noticed the man with Fujian roots. In 1962, he found himself in a struggle for the sugar market with the Chinese, who were desperate to earn foreign exchange through Malaysia. Mr Kuok sourced from India at a lower price, and beat off the Chinese, but he had earned sufficient respect from them to win agencies for cameras, refrigerators and dyeing materials. This was the beginning of Mr Kuok's move back towards the homeland, although his first shift of base was from Malaysia to Singapore, where in 1971, he established the Shangri-La hotel. Three years later he started to put down corporate roots in Hong Kong, arriving here in 1975, and establishing the Shangri-La hotel in Tsim Sha Tsui in 1977. He rapidly became a big investor in the territory through his Kerry Group, which one analyst described as a wheel of many spokes with Robert Kuok as the hub. The Kuok influence is felt in TVB, in which Kerry has a 32 per cent stake, and Mr Kuok and his son Khoon Chen sit on the board. This holding would have been dramatically reduced if News Corporation's attempt to take a 22 per cent holding in TVB had not fallen through in July. There is also a 15 per cent stake in the Western Harbour Tunnel Consortium, a 10 per cent holding, recently reduced from 13 per cent, in CITIC Pacific - the locally quoted arm of the mainland China investment vehicle - and an interest in Aberdeen Marina. But like so many overseas Chinese, Mr Kuok has been strongly drawn to the mainland by the opportunities offered by Deng Xiaoping's capitalist revolution. While hotels and property have been among his major investments, Mr Kuok is not one of those who have concentrated on the rapid profits that appear possible from real estate. He has plunged into industrial projects, such as the US$100 million (HK$774 million) investment made by Kerry Oil and Grains in vegetable oil plants around the country. But some of his property ventures have been truly ambitious - if not always successful. In March this year, he pulled Kerry out of a HK$1 billion project to redevelop Beijing's Wangfujing shopping district reportedly because of differences with the localpartner. Despite that pullout, and the austerity programme, the Kerry group is committed to its major developments in China, Mr Kuok has said. This has already been a relatively long-term programme. Ten years ago, Kerry Industrial joined a joint venture to build the World Trade Centre in Beijing, a 12-hectare complex of offices, shops, hotels and residences. Its most prominent development now is the HK$4.6 billion Shanghai Everbright City in which it links up with China Everbright, Li Ka-shing's Cheung Kong, CVIC Properties and Top Glory. In Shenzhen, the Regency Park and Top Spring Plaza are two major investments planned by Kerry. Rarely a man to speak out in public, Mr Kuok broke his silence earlier this year to set out his investment philosophy for China. ''The reason for investing in China is threefold, first, to show that capitalists are not unscrupulous businessmen, there is something good in them; second, the investments will help modernise China; and third, by promoting economic prosperity, the mainland will improve day by day, it will become better and more progressive,' he told a pro-Beijing newspaper in Hong Kong. But while he added that his heart was split between his family's homeland, and the Malaysia where he grew up, he had great regard for the advantages of Hong Kong. ''As a Chinese businessman, there is nowhere in the world which is comparable with Hong Kong. This is really a good place to set up business headquarters. Hong Kong's rule of law by international standard is good, the Government exercises effective management. After the principles are established, you are free to do business without interference. It is a bad habit of the Chinese people to intervene. We should change this habit.'' As for 1997, he professed to be sanguine: ''I am not worried. I hope the central Government in Beijing will uphold the 'one country, two systems' policy and make it successful. I am confident of this.''