In just three days, the Executive Council has met twice to discuss the proposed merger between the MTR Corporation and KCRC. The complexity of the issue aside, the move clearly demonstrates the government's eagerness to settle the controversial merger swiftly - and is not unrelated to last month's management crisis which rocked the Kowloon-Canton Railway Corporation. This saw acting chief executive Samuel Lai Man-hay resign just a day after a feud between him and KCRC chairman Michael Tien Puk-sun appeared to have been resolved. In addition to a management shake-up, the row also served as a timely wake-up call on the urgency to move ahead with the merger. With the row resolved in the middle of last month, Secretary for Environment, Transport and Works Sarah Liao Sau-tung said the merger could be in the works within two months. A source familiar with the Exco discussions said the government was acutely aware of the negative impact for the MTRC as a listed company if the merger issue dragged on for too long. If endorsed, the proposal will see the KCRC managed as part of the MTRC under an asset-leasing agreement signed between the government - as sole owner of the KCRC - and the MTR. Lau Kong-wah, deputy chairman of the Democratic Alliance for the Betterment and Progress of Hong Kong, believed the proposed model would improve corporate governance. 'We can assume that corporate governance of the two corporations will be enhanced with one chairman, one CEO, and one management team.'
