Corporate Personality

Hong Kong’s richest woman loses half her wealth on paper as Kingston shares plummet

PUBLISHED : Monday, 19 March, 2018, 3:51pm
UPDATED : Tuesday, 20 March, 2018, 4:09pm

Pollyanna Chu has lost her title as Hong Kong’s richest woman after her listed company turned into Asia’s worst performer this year.

Worth almost US$12 billion as recently as January, she’s seen more than half of her wealth wiped out as the stock crashed. Kingston Financial Group, which operates businesses including Macau casinos and margin lending, has tumbled 52 per cent since Hong Kong’s securities regulator in January warned investors that the company’s shares were overly concentrated among a small number of stockholders.

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Kingston Financial plunged 12 per cent on Monday after FTSE Russell, one of the world’s most-followed index providers, removed the stock from its benchmarks. For its financing, the firm relies largely on unsecured loans provided cheaply by Chu and her family, according to January analysis from activist investor David Webb. 

The stock is the worst performer on MSCI Inc.’s Asian gauge this year, after surging 88 per cent in the last quarter of 2017.

Some speculators may have made a killing from Kingston’s misfortunes -- short interest was about 6.3 per cent of free float as of Friday, according to IHS Markit data. The company declined to immediately comment on the slump in shares. 

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The Securities and Futures Commission said in a January 29 statement that 20 holders controlled more than 91 per cent of the shares as of Jan 8. The stock plunged 17 per cent the following day.

Part of Chu’s wealth stems from her father’s background managing casino VIP rooms in the Asian gambling centre of Macau. 

The sector still features prominently in the family controlled business; gaming and hotel revenues from the former Portuguese colony amounted to more than HK$670 million (US$85 million) for the 2017 financial year, some 23 per cent of total sales, according to Kingston’s annual report.

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Chu is joining a record US$5.2 billion deal to buy most of a Hong Kong skyscraper from Li Ka-shing’s company, people familiar with the matter said last month. Chu will take a 17 per cent stake, they said.

Pansy Ho, the daughter of Stanley Ho, is now No. 1 in Hong Kong’s ultra-rich women list, followed by Vivien Chen, chairwoman of closely held real estate developer Nan Fung Group, according to Bloomberg’s Billionaires Index.