Shares of SHK in HK are down about 13% today on the news. Sun Hung Kai Loses $5.8 Billion as Billionaire Kwoks Arrested
Interesting development in Hong Kong. From the past when Walter Kwok was ousted by his own brothers:
"Walter Kwok also said in his filing that he wanted to investigate the reasons why construction contracts were frequently awarded by Sun Hung Kai to a select number of contractors. In addition, Walter Kwok's proposal to hire an auditor to review the company's management and suggest measures for improvement weren't heeded, the filing said, noting that these disagreements eventually led to his removal. The company rejected the claims he made in his filings, and a court refused to issue an order to block Walter Kwok's removal."
Was Walter Kwok right after all?
The Wall Street article:
Two billionaire brothers who are among the city's most powerful property tycoons and the city's former No. 2 official were arrested Thursday on suspicion of bribery in a case that gets to the heart of city's business culture and its economy.
The Kwok brothers and their families control Sun Hung Kai Properties Ltd., one of the world's biggest real-estate developers and a company that has itself been hit in the past by bitter family feuds and a kidnapping. The company built some of the most famous towers in Hong Kong's skyline, including its three tallest buildings. In a city where a small group of powerful organizations control real estate, transportation and communications, the sight of two tycoons walking into law-enforcement offices to answer questions in a corruption case was riveting.
"It's been a long time since such senior figures in the construction industry have been subject to such attention," said Steve Vickers, chairman of Asia investigations for FTI Consulting Inc.
Thomas Kwok, 60 years old, and Raymond Kwok, 58, were arrested Thursday by Hong Kong's antigraft agency, Sun Hung Kai said in a statement late in the day. The Independent Commission Against Corruption also arrested the city's former No. 2 official, Rafael Hui, also on suspicion of bribery and on suspicion of misconduct in public office, a person familiar with the situation said. Sun Hung Kai said the Independent Commission Against Corruption searched the company's offices on Thursday.
The Kwok brothers couldn't be reached, and names of their lawyers couldn't be learned. Attempts to reach Mr. Hui or his office were unsuccessful.
The Kwoks are co-chairmen of a real-estate empire with a stock-market value of $37.25 billion and properties stretching across southern China, Shanghai and Beijing. The company's shares were halted from trading early Thursday, about 20 minutes after the market opened.
No charges have been filed against the individuals. Hong Kong's laws, which are modeled after the British legal system, empower law-enforcement agencies to detain or offer bail to suspects before deciding whether to file criminal charges against them. The three men left ICAC offices late Thursday, though no further details were available about the case. The ICAC declined further comment on the case.
The ICAC is a unique law-enforcement agency. It was set up in the 1970s as an independent body to tackle what was then rampant corruption among Hong Kong's police force. The agency reports directly to the city's chief executive.
Kudus for ICAC and Hong Kong. When will this happen in Malaysia?
ReplyDeleteExactly .....!
ReplyDeleteTo:Mr Singh (new Bursa CEO),
ReplyDeleteWhat plans do you have to make KLSE become a (more) level playing field...and you must act and be seen to act quickly before KLSE becomes a backwater exchange....and stop or at least slow the decline against HKSE and SES (read lately in mid 1970s we were on par in turnover vs. HK and much bigger than SES and now we are a speck vs. these 2).
The ICAC (independent Commission Against Corruption) was set up by the late governor of Hong Kong, Sir Murray McLehose. He is remembered by most H K people as a reformer. Hong Kong became an international financial center because of its supposedly clean investment environment.
ReplyDeleteIt is rumored that even Beijing could not stand aside to do nothing seeing the extent of interlocking relationships between H K senior civil servants and the real estate tycoons. Even Sir Donald Tsang is taking advantage of his position to get some benefits. Depressing.
ReplyDelete