CDL shares fell 7% as trading resumes amid boardroom brawl

SINGAPORE: City Developments Limited (CDL) shares fell 7 per cent on Monday morning (Mar 3) after the company lifted its trading halt. The stock dropped S$0.36 to S$4.76 at market open, its lowest level since 2009, according to Bloomberg data. By 9:07 am, it was down 5.5 per cent at S$4.84, with 3.3 million shares traded, The Business Times reported.

CDL said its business operations remain fully functional and are unaffected by the ongoing boardroom dispute, adding that it is “business as usual.”

In a statement, the company also announced that Mr Sherman Kwek remains CDL’s group chief executive officer “until such time as there is a Board resolution to change company leadership.”

The company halted trading on Feb 26 after the fallout of CDL’s father and son, executive chairman Kwek Leng Beng and group chief executive officer Sherman Kwek, over the composition and constitution of the company’s board and the board committees, as reported by Channel News Asia.

The older Mr Kwek later announced he had taken legal action, a move to “set things right,” against an alleged “attempted coup” by his son, along with board members Philip Lee Jee Cheng, Wong Ai Ai, and a group of directors.

He also proposed the removal of his son as CEO to “prioritise the interests of all shareholders,” naming his nephew, chief operating officer Kwek Eik Sheng, as interim CEO if and when his son is removed while the group looks for a professional CEO to lead the company, The Business Times reported.

Meanwhile, the younger Mr Kwek pointed to his father’s adviser, Dr Catherine Wu as the “primary reason for the dispute,” adding there has been no attempt to oust his father and that the move was to “ensure CDL has the highest standards of governance.”

Pointing to allegations on the matter, the company noted it “will not comment on the validity of these allegations, as many of these allegations are the subject of the court proceedings which are ongoing.”

The case will be heard in Singapore’s Supreme Court on Mar 4 in a closed-door session. /TISG