The market watchdog’s requests comes a week after the ongoing family feud within the property giant.

The Securities Investors Association (Singapore) (SIAS) has asked City Developments (CDL) to clarify Dr Catherine Wu’s role as director on the board of Millennium & Copthorne Hotels (M&C), and how it intends to safeguard shareholder value given CDL’s underperformance, among other requests. 

The market watchdog’s request comes a week after the property giant’s ongoing family feud, in which chairman Kwek Leng Beng sought to fire his son and group CEO Sherman Kwek over allegedly plotting a boardroom coup.

In retaliation, the younger Kwek has accused his father of being influenced by his longtime advisor Wu. On Mar 4, the older Kwek announced the “irrevocable resignation” of Dr Catherine Wu as an “unpaid independent adviser”. 

SIAS has called CDL to clarify the strategic value of the proposed privatisation of Millennium & Copthorne Hotels New Zealand (MCK), in which the property giant recently made an offer of $2.25 per share, which was later rebuffed by MCK’s directors. 

SIAS seeks to clarify the governance on the framework currently in place especially with regards to director nomination, selection and appointment. 

In addition, the watchdog has asked CDL to clarify on Wu’s appointment, such as whether her appointment was approved by the board, and reasons for her cessation from the M&C board.

They also seek to clarify if there was a rigorous search and nomination process for the role of an independent advisor to the board, and what were the key deliverables and responsibilities for the role. 

The two new directors which were at the crux of the disagreement on Feb 26 are Jennifer Duong Young and Wong Su-Yen, which the older Kwek alleges were nominated hastily. 

SIAS has questioned the actual process for identifying and appointing the two newly appointed directors, and who they spoke with prior to their appointment during the search and nomination process. 

“Given that they are not first-time directors, can the two directors let shareholders know if they had requested to meet the nominating committee as part of a formal and transparent appointment process? Do the two directors believe that their nomination and appointment adhered to best corporate governance practices?” the release by SIAS reads. 

Finally, SIAS asks how CDL intends to assure shareholders that the board remains effective and aligned on business goals, given the apparent ongoing split in direction. The association notes that Kwek Eik Sheng was appointed group COO, and questions what his reporting lines are during this period. 

The watchdog also asks for directors to commit to making all statements relating to the current situation on SGXNext first, so as to ensure that no material information is selectively disclosed to any parties. 

Shares in City Developments closed 5 cents lower or 0.98% down at $5.05 on March 6.

See also:

• Dr Catherine Wu resigns; CDL CEO can ‘no longer’ make corp governance allegations and justify board coup: Kwek Leng Beng
• 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