The recent boardroom dispute at City Developments Limited (CDL) involving executive chairman Kwek Leng Beng and his son, group CEO Sherman Kwek, has captivated the attention of many in Singapore. The conflict centers around allegations of governance lapses and a power struggle at the board level, raising concerns about CDL’s governance and share price volatility. As the legal battle unfolds, here is a detailed timeline and updates on the escalating feud between father and son.
Timeline of Events
The conflict began on Jan 28 when an email was sent to CDL’s board, nominating two new independent directors without full board approval. The elder Kwek questioned the urgency of these appointments, expressing concerns about the lack of proper review and transparency. A board meeting was later requisitioned on Jan 31, where the proposed appointments were approved through a written resolution, sparking accusations of a pre-planned effort to consolidate control.
Tensions continued to rise on Feb 8 when Kwek Leng Beng sought his son’s removal as group CEO, citing past business decisions and underperformance since Sherman Kwek assumed leadership in 2018. The board opposed this move, leading to further conflict within the company. In response, CDL announced the merger of its nominating and remuneration committees on Feb 21 to enhance governance oversight.
On Feb 25, court papers were filed by the elder Kwek to address what he described as an attempted “coup” and to restore corporate integrity. Despite the legal actions, CDL’s trading was halted on Feb 26 due to disagreements within the board, with the company assuring that business operations remain unaffected.
Resolution and Continuing Disputes
Following a court hearing, Kwek Leng Beng announced on Feb 26 that further actions by his son and other directors had ceased, allowing the board to function normally without interference. However, Sherman Kwek continued to dispute his father’s actions, highlighting Dr. Catherine Wu’s involvement in the conflict as a source of contention within CDL. The younger Kwek emphasized the need to protect shareholders’ interests and restore proper governance, denying any attempts to oust the chairman.
As the legal wrangle persisted, CDL shares remained suspended, reflecting the ongoing turmoil within the company. The public war of words between father and son, coupled with internal disagreements over corporate governance, underscore the challenges facing CDL as it navigates this complex boardroom dispute.
In the midst of this tumultuous situation, investors and industry observers closely monitor the developments at CDL, awaiting further clarity on the company’s leadership and governance structure. The resolution of this conflict will undoubtedly have far-reaching implications for CDL’s future trajectory and reputation in the property market.
The saga at CDL serves as a cautionary tale of the complexities inherent in family-run businesses and the delicate balance between personal relationships and corporate governance. As stakeholders await the next chapter in this unfolding drama, the fate of City Developments Limited hangs in the balance, caught in the crossfire of a high-stakes battle for control and integrity.
