SINGAPORE: Shares of City Developments (CDL) jumped on Thursday (Mar 13), a day after executive chairman Kwek Leng Beng said he was dropping the lawsuit against his son Sherman Kwek and a group of directors.
The counter rose 4.25 per cent or S$0.21 to S$5.15 by midday, slightly below its intra-day high of S$5.16, with about 3.4 million shares worth S$17.6 million having changed hands.
It outperformed the broader Straits Times Index, which dipped 0.1 per cent by the end of the morning trading session.
In a statement issued late on Wednesday, the senior Kwek said he will discontinue the lawsuit filed in late-February and continue his role as executive chairman. Mr Sherman Kwek will also continue as group CEO.
All the current directors will remain on the CDL board, he added.
The senior Kwek also said all CDL board members have agreed to “put aside their differences” for the greater good of the company and its stakeholders.
The latest turn in events came two weeks after the family feud spilled into public view on Feb 26, when Mr Kwek Leng Beng accused his son of mounting a boardroom “coup”.
The dispute centred on the appointments of two new independent non-executive directors - Ms Jennifer Duong Young and Ms 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 Mar 3, but recovered over the week.
Research houses, however, have slashed their target prices for the company’s shares.
The saga also prompted the Securities Investors Association (Singapore), or SIAS, to pose a slew of questions to the company over its board appointments and the role of a former advisor Dr Catherine Wu, who was named by Mr Sherman Kwek as the primary reason for the public fallout with his father.
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