City Developments Limited ’s (CDL) executive chairman Kwek Leng Beng has announced the “irrevocable resignation” of Dr Catherine Wu as an “unpaid independent advisor” on March 4. This comes just days after the elder Kwek issued his statement in response to his son Sherman’s claims regarding the remarks of the court.
According to Leng Beng’s latest statement, Dr Wu stepped down from her position – a post she held since August 2024 – “with immediate effect”. Before that, Dr Wu was a director of the board of directors of Millennium & Copthorne Hotels (M&C) between June 2022 and January 2024.
“During her tenure at M&C, Dr Wu contributed well in many of M&C's achievements. We are grateful to Dr Wu for her service over the years and wish her well in her future endeavours,” says the elder Kwek.
Following Dr Wu’s resignation, Sherman, who is the CEO of CDL, and his team of directors will no longer be able to make “such corporate governance allegations” about CDL and justify his board coup, Leng Beng adds.
The younger Kwek, in a Feb 27 statement, alleged that Dr Wu was the reason behind the group’s dispute.
“Although her official position is advisor to the board of M&C, a wholly owned and principal subsidiary of CDL Group, she has been interfering in matters going well beyond her scope, and she wields and exercises enormous influence. These matters have troubled us as directors,” Sherman said at the time.
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With Dr Wu’s resignation, the elder Kwek said that it was “high time” that the group “restore investor confidence” and ensure that the breaches by his son and his team of directors, which includes breaching the Singapore Exchange ’s (SGX) listing rules and the code of corporate governance “will never happen again".
Leng Beng also reiterated the points he made from his first statement, that CDL, under Sherman’s leadership as CEO, suffered an “extraordinary loss” of $1.9 billion in FY2020 thanks to the Sincere Property debacle.
In addition, he blamed his son for “poorly judged investment decisions” in the UK, which led to “substantial financial setbacks” that resulted in a 94% drop in profits in CDL’s 1HFY2023 results.
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Finally, he noted that CDL’s share price has also “persistently lagged” behind its peers since Sherman became CEO in 2018, adding that shares in the group fell even further from the recent breaches. On March 3, after trading of the group's shares resumed, CDL's shares opened at $4.855, 5.17% lower than its last-closed price of $5.12.
“The first step in addressing these challenges should be to strengthen the corporate governance framework in a way that aligns with shareholders' long-term interests," says Leng Beng. "Our utmost focus on CDL’s core businesses is critical and essential for regaining a stable path of profitability. I am convinced that such an approach will surely restore investor confidence and enhance shareholder value over time.”
In a statement issued on Feb 28, Phillip Yeo, a non-independent non-executive director at CDL, also reminded Sherman that he should be "focused on making back the $1.9 billion of shareholders' losses through Sincere Property" as well as the other losses from the group's property investments in the UK.
Shares in CDL closed 3 cents lower or 0.6% down at $4.97 on March 4.
See also:
- SIAS asks CDL to clarify Dr Catherine Wu’s role at M&C, process of board appointments, and shareholder safeguards
- Urgency of court application stems from disruption of CDL’s corporate structure; Phillip Yeo sees saga as distraction
- Primary reason behind CDL’s dispute is related to M&C board advisor Dr Catherine Wu, says Sherman Kwek
- CDL board fight cools with undertaking from two new IDs
- Father and son battle it out in court for control for CDL
- Sherman Kwek to remain as group CEO of CDL; finds episode 'incredibly disappointing'
- CDL calls for trading halt, cancels FY2024 results briefing
