A dramatic family feud is unfolding at City Developments Limited (CDL), one of Singapore’s top property firms. Kwek Leng Beng, the executive chairman, is embroiled in a legal conflict with his son, Sherman Kwek, the group CEO, over accusations of governance failures and an alleged power grab within the company. This saga highlights not just a clash of interests but also a pivotal moment for the legacy of Singapore’s Kwek family.
The Legal Dispute
On 26 February 2024, Kwek Leng Beng filed court papers alleging that his son and several directors, including Philip Lee and Wong Ai Ai, attempted an “internal coup” by sidestepping CDL’s Nomination Committee. The dispute escalated on 28 January when an email circulated among board members suggesting the appointment of two new independent directors just before Chinese New Year.
- Kwek Leng Beng expressed concerns about the hurry to approve these nominations without proper scrutiny.
- Despite objections, a board meeting on 7 February went ahead, and subsequent resolutions were passed approving the new directors.
Father-Son Dynamics
This feud comes amid heightened scrutiny of Sherman’s performance as CEO, particularly after a significant S$1.9 billion loss linked to CDL’s investments in China. Kwek Leng Beng’s move to remove his son from the CEO position reflects deep familial and corporate rifts.
“As a father, firing my son was certainly not an easy decision,” said Kwek Leng Beng. “But circumvention of corporate governance laws is a red line.”
A Potted History of CDL
Founded in 1963, CDL has become a cornerstone of Singapore’s property market. By acquiring a controlling interest in CDL in the 1970s, the Kwek family transformed it into one of Singapore’s leading property developers.
- Kwek Leng Beng has been pivotal in enacting strategic acquisitions, such as the Plaza Hotel in New York in 1995, solidifying his reputation in the hospitality industry.
- The company boasts over 150 hotels around the world, and under Sherman’s leadership, it expanded further into Asian markets.
The Future of CDL
If Kwek Leng Beng’s legal action succeeds, Kwek Eik Sheng—currently the group chief operating officer—will step in as interim CEO, paving the way for potential shifts in leadership and strategy at CDL. Kwek Leng Beng has made it clear he intends to fight for the company’s governance standards and shareholder interests.
This saga continues to unfold, leaving many to wonder about the future direction of CDL and the Kwek family’s enduring legacy in Singapore’s business landscape.