SINGAPORE: The Securities Investors Association (Singapore), or SIAS, has posed a slew of questions to City Developments Limited (CDL) over the roles that Dr Catherine Wu held at subsidiary Millennium & Copthorne Hotels (M&C).

In a letter directed to CDL’s chairman and board members on Thursday (Mar 6), SIAS asked if Dr Wu’s appointment as M&C’s board director between June 2022 and January 2024 was approved by the company’s board, whether her performance was assessed and reasons behind her leaving the post last year.

Dr Wu, who has been thrown into the spotlight amid an ongoing tussle between father and son for control of CDL, also held the post of independent adviser to the board of M&C since last August. She resigned on Tuesday.

On that, SIAS asked if there was a “rigorous search and nomination process” for the position, the key deliverables and responsibilities of an independent adviser and whether there would be a replacement for the position.

Sherman Kwek, Catherine Wu and Kwek Leng Beng. (File photos: City Developments Limited, LinkedIn/Millennium Hotels and Resorts)

The letter, which included questions on new board appointments at CDL, business and share price performance, and the responsibility for legal fees, was issued after the retail investor advocacy group received “numerous queries” from shareholders.

“Shareholders of CDL were shocked by the unexpected events and would like the dispute to be resolved amicably as soon as possible,” founder-CEO David Gerald told CNA.

The high-profile family feud became public on Feb 26 when executive chairman Kwek Leng Beng issued a lengthy statement accusing his son, group CEO Sherman Kwek, of attempting a boardroom “coup”.

The dispute centered on the appointments of two new independent non-executive directors –Jennifer Duong Young and Wong Su-Yen – that the senior Kwek said were “hastily” made without going through CDL’s nomination committee.

Over the next few days, explosive statements emerged from both camps, raising concerns over the property giant’s corporate governance and business stability.

Amid the power tussle, CDL called for a trading halt on Feb 26. Its shares fell more than 6 per cent to fresh 16-year lows upon resumption of trade on Monday, but has since recovered.

The counter last traded at S$5.05 on Thursday, not too far from the trading price of S$5.12 before a trading halt was called.

That said, SIAS noted that CDL’s share price has underperformed the wider market.

It asked if the board was reviewing the company’s strategic direction and if the board had introduced any interim or temporary measures during this period to safeguard shareholder value.

SIAS also posed a series of questions about the two new board appointments at CDL, including the process for identifying and appointing them and if the newly appointed directors had requested to meet the nominating committee “as part of a formal and transparent appointment process”.

There were also queries about the company’s board’s effectiveness and ability to stay aligned on business goals given the “apparent split” in the board.

In addition, the retail investor watchdog sought clarity on the management structure and decision-making process at CDL, specifically on the reporting lines for the group CEO (GCEO) and group chief operating officer (GCOO) Kwek Eik Sheng.

The latter, who is the nephew of Mr Kwek Leng Beng, has been named by the senior Kwek as interim group CEO should Mr Sherman Kwek be removed.

“How does the board ensure cohesive leadership and effective decision-making during this period? What key performance indicators are in place to assess the performance of the GCEO and GCOO? How are key decisions made and approved during this period?” SIAS wrote in its letter.

SIAS also pointed to recent media reports that carried statements from the company’s key executives and how the resignation of Dr Wu was announced through the media, rather than through a filing on the Singapore Exchange (SGX).

On that, the retail investor watchdog asked for directors to “commit to making all statements related to the current situation on SGXNet first”.

Doing so will “ensure that any statements and disclosure made by the directors comply with SGX listing rules, and that no material information is selectively disclosed to any parties,” it said.

“Directors making individual statements should provide personal attestations or sign-offs for greater accountability.”

Among others, SIAS also wanted to know who will be footing the bill for the legal advisers and lawyers that have been engaged for the court battle.

“SIAS would sincerely appreciate the board’s timely responses to these queries, which will provide much-needed transparency and assurance to shareholders and stakeholders,” said Mr Gerald, who signed off the letter.

CNA has reached out to CDL for comment.

Both camps have had two closed-door hearings at the Singapore High Court thus far.

The next hearing is scheduled for after CDL’s annual general meeting, which is likely to be held on Apr 23, CNA understands.

Mr Kwek Leng Beng is supported by board directors Philip Yeo, Colin Ong and Chong Yoon Chou. They are represented by lawyers from LVM Law Chambers, a law firm led by Senior Counsel Lok Vi Ming.

The other camp comprises Mr Sherman Kwek, alongside directors Philip Lee, Wong Su-Yen, Jennifer Duong Young, Carolina Chan, Daniel Marie Ghislain Desbaillets and Wong Ai Ai. 

Mr Sherman Kwek and his group of directors have roped in Senior Counsel Davinder Singh to represent them, alongside a legal team from Lee & Lee.