Real estate billionaire Kwek Leng Beng has disclosed that he has filed a lawsuit in Singapore against his son, Sherman, for control of the family’s crown jewel, property giant City Developments Ltd. (CDL).
“We have filed court papers today to set things right,” Kwek Leng Beng, 84, executive chairman of Singapore-listed CDL, said in a statement. “This is necessary to deal with this attempted coup at the board level and restore corporate integrity.”
Sherman Kwek, 49, is group CEO of CDL, a position he’s held since 2018. Sherman allegedly colluded with some board members to wrest control by making changes to the board’s composition by appointing two new directors without proper vetting by the nomination committee, according to his father.
“We intend to change the chief executive officer at the appropriate time.” the executive chairman said. “We will continue to explore all legal options available to us to vigorously defend and protect the interests of CDL and its shareholders.”
News of the boardroom brawl broke after the company reported a 37% decline in 2024 net profit to S$201.3 million ($150.5 million) from the previous year. In the earnings statement, Sherman Kwek said “2024 has been a year of formidable headwinds, with macroeconomic pressures and sector-specific challenges weighing on the group’s near-term earnings and portfolio calibration plans.”
CDL said in a separate statement that it had canceled a scheduled Wednesday morning media briefing and temporarily suspended trading in its shares “in view of the disagreement within the board.”
“Despite this temporary suspension, our business operations remain fully functional and unaffected,” the company said, adding that Sherman Kwek remains the group CEO “until such time as there is a Board resolution to change company leadership.”
Another statement by Sherman on behalf of the “majority of the Board” said the recent change in the board’s composition “has never been about ousting the esteemed chairman.”
“These steps to strengthen our Board have purely been to ensure CDL has the highest standards of governance ……, and our collective decision making as a board is as robust as possible,” according to the emailed statement. “As the matter is now before the courts for adjudication, we will not comment on the merits of the case and will make further announcements if there are any material developments.”
With a net worth of $11.5 billion, Kwek Leng Beng and his family are among Singapore’s wealthiest. He and his late brother Kwek Leng Joo and their father, Kwek Hong Png, bought loss-making City Developments in 1971 and transformed it into one of the city-state’s largest property developers with a market cap S$4.6 billion. Kwek Leng Beng is also executive chairman of privately held Hong Leong Group, which was founded by his father in 1941 as a trading firm. His cousin Quek Leng Chan, also a billionaire, owns and runs a separate group in Malaysia, also called Hong Leong, a name that translates into ‘good harvest.’
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