‘Stripping away any meaningful authority’ of CDL’s chairman is a ‘coup’: Kwek Leng Beng

CITY Developments Ltd executive chairman Kwek Leng Beng has alleged that his son’s denial of an attempted coup “misses the point”, in yet another twist to the father-son/board tussle rocking the company.

“Protecting good governance, including the office of the executive chairman, and not me as an individual, is critical. Stripping away any meaningful authority of the executive chairman is a coup,” Kwek Leng Beng said in a statement late on Friday (Feb 28).

The elder Kwek also claimed that his son Sherman’s remarks regarding the remarks of the court in their ongoing dispute are “misleading”.

Kwek Leng Beng’s statement comes a day after his son alleged that the primary cause of the dispute is the conduct of Dr Catherine Wu, an adviser to the board of CDL’s hospitality arm Millennium & Copthorne Hotels (M&C).

Sherman Kwek said that Dr Wu, who has a “long relationship” with his father, “has been interfering in matters going well beyond her scope, and she wields and exercises enormous influence”.

In another statement issued together with Kwek Leng Beng’s response, CDL director Philip Yeo called Sherman’s latest salvo “an attempt to distract everyone from the matter at hand”.

He reiterated that the CEO and those acting with him had “circumvented the Nomination Committee intentionally” and pushed through the appointment of two new additional independent directors against legal advice, then “quickly reconstituted” committees to “effectively immobilize the Executive Chairman”.

Yeo is a non-independent, non-executive director at CDL.

“The CDL CEO should be focused on making back the US$1.9 billion of shareholders’ losses through Sincere Properties as well as the other losses from the UK property investments,,” said Yeo. “Instead, he seems more concerned about grievances, mobilising a group of independent directors to remove an advisor to the CDL hospitality business, which has actually seen profit improvements for the past few years since COVID.”

Sherman Kwek has denied that he attempted to oust Kwek Leng Beng as chairman.

The saga erupted on Feb 26, after Kwek Leng Beng said that he had filed court papers to deal with an “attempted coup” – by his son, board members Philip Lee Jee Cheng and Wong Ai Ai, as well as a group of directors acting with them.

The elder Kwek claimed the appointment of two new directors – Jennifer Duong Young and Wong Su Yen – was done without due diligence and proper vetting.

According to Kwek Leng Beng, his son’s group had bypassed the nomination committee, contrary to corporate governance principles and the Singapore Exchange’s listing rules.

The elder Kwek issued a second statement at 11.34 pm on Feb 26, saying that after a court hearing that day, “the serious lapses of corporate governance at CDL (together with its subsidiaries) have now been halted”.

Sherman Kwek challenged these statements on Feb 27, claiming that his father’s group had actually failed in its application to reverse certain resolutions that were passed.

“What in fact happened was that because the majority directors did not have the opportunity to present our case, we voluntarily offered undertakings, as defendants often do in such urgent applications, to preserve the status quo until a full hearing where we would have that opportunity,” said Sherman Kwek.

Sherman Kwek and the six directors in his group are represented a legal team led by Julian Tay of Lee & Lee. The six directors are Lee, Wong Ai Ai, Daniel Desbaillets, Carolina Chan, Wong Su Yen and Young.

CDL, Kwek Leng Beng, and three other directors – Yeo, Ong and Chong – are represented by Senior Counsel Lok Vi Ming of his own firm LVM Law Chambers.

CDL shares have been under a trading halt since Feb 26.