Sias queries CDL on role of Catherine Wu, appointment of two new directors

SINGAPORE – Shareholders of City Developments Limited (CDL) have submitted numerous questions after news emerged on Feb 26 of

a tussle between father and son

for control of the Singapore property developer, the Securities Investors Association (Singapore), or Sias, said on March 6.

These include the role of

Dr Catherine Wu

, the former unpaid adviser to CDL subsidiary Millennium & Copthorne Hotels (M&C), and how two new directors were appointed to the board of CDL without the necessary approvals.

CDL executive chairman Kwek Leng Beng has

accused his son Sherman Kwek

, who is the group chief executive, of bypassing the nominating committee to change the composition of the company’s board with the appointment of two new directors,

Ms Jennifer Duong Young and Ms Wong Su-Yen

. He also called it an “attempted coup” and filed court papers to address it.

But the younger man said the underlying reason that led to the public fallout at the company was his father’s adviser, Dr Wu.

Dr Wu subsequently

resigned as an unpaid adviser to M&C

on March 4.

Sias president and chief executive David Gerald questioned: “What was the role of Dr Catherine Wu as a director on the board of M&C from June 2022 to January 2024? Was her appointment approved by the board? Was her performance assessed by the M&C board and, if so, what were the findings?”

He asked for the reasons behind her resignation from the board and questioned if there was a “rigorous search and nomination process” for the role of independent adviser. He also queried the responsibilities of the role and whether there would be a replacement for the position.

Mr Gerald also raised questions on the appointment of the two new directors of CDL, Ms Young and Ms Wong, and asked what the process was for identifying and appointing them.

“Can the company clarify whom the two newly appointed directors met and spoke with prior to their appointment during the search and nomination process?” he asked.

He said Ms Young and Ms Wong are not first-time directors and wanted them to 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?” he asked.

Mr Gerald pointed out that while CDL has acknowledged media reports on various allegations, it has stated that it will not comment on their validity. Yet the company has committed to updating shareholders on material developments.

He noted that media reports have surfaced detailing statements made by various parties involved, such as Mr Kwek Leng Beng and his son and

Mr Philip Yeo, a director siding with the older Mr Kwek

. Dr Wu’s resignation also first emerged through the media.

“Would all directors commit to making all statements related to the current situation on SGXNet first? This would also ensure that any statements and disclosure made by the directors comply with Singapore Exchange listing rules, and that no material information is selectively disclosed to any parties.”

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

Questions relating to board effectiveness and the company’s performance moving forward were raised as well.

“Given that there is an apparent split in the board, how can shareholders be assured that the board remains effective and aligned on the business goals?” Mr Gerald queried.

He also asked if the board is reviewing the group’s strategic direction, given that

CDL’s share price has underperformed

.

The stock plunged 6.5 per cent from its last traded price of $5.12 on Feb 25 to $4.79, a 16-year low, after it began trading on March 3, but recovered its losses to close down 2.3 per cent at $5.

It closed on March 6 at $5.05.

“Has the board introduced any interim or temporary measures during this period to safeguard shareholder value?” Mr Gerald asked.

He also noted that while CDL had highlighted strong residential sales performance in 2024, Union Square Residences has not done well in sales, with only 31 per cent of units sold since its launch in November 2024.

He wanted to know if the launches of

Zion Road (Parcel A)

and Newport Residences were proceeding as planned.

Another ongoing issue is the takeover of Millennium & Copthorne Hotels New Zealand, for which the group

recently made an NZ$2.25 per share offe

r, but the directors of the New Zealand entity rejected it.

“Given the ongoing board dispute, how is the board ensuring sufficient focus on this transaction? What is the strategic value of the proposed privatisation?” Mr Gerald asked.

With regard to senior management structure, queries were raised about the reporting line of Mr Kwek Eik Sheng, who was appointed group chief operating officer (COO) in January 2022 and named by Mr Kwek Leng Beng as the person to serve as interim CEO, in place of his son Sherman.

“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 group CEO and COO? How are key decisions made and approved during this period?” Mr Gerald asked.

Finally, he alluded to the ongoing boardroom battle that will be fought in court, for which Mr Sherman Kwek has

roped in Senior Counsel Davinder Singh

for his team of lawyers, while his father and three other board members are represented by LVM Law Chambers. 

Mr Gerald asked: “Who is covering the costs of the legal advisers and lawyers engaged by the directors?”