FILE: Kwek Leng Beng, chairman of City Developments Ltd., right, and Sherman Kwek, chief executive … [+] officer, during a news conference on Feb. 21, 2019. Photographer: Ore Huiying/Bloomberg

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City Developments Ltd. (CDL) lost its spot as the most valuable publicly traded property developer in Singapore as shares tumbled when trading resumed Monday following a three-day halt amid a boardroom battle for control of the company.

Despite assurance from CDL that “business operations remain fully functional and unaffected” by the ongoing dispute between executive chairman Kwek Leng Beng and his son Sherman Kwek, the company’s CEO, the stock slumped as much as 7% in the morning, touching the lowest level since March 2009. It had recouped some losses in the afternoon, closing 2.3% lower.

“We downgrade the stock to a hold in light of the very public leadership fracture as we believe that the company’s share price is unlikely to perform with this overhang,” Adrian Loh, an analyst at UOB-Kay Hian, wrote in a report on Thursday.

Following today’s decline, CDL’s market capitalization slipped to S$4.5 billion ($3.3 billion), below the S$4.7 billion market value of rival UOL Group, which is controlled by the family of late banking billionaire Wee Cho Yaw.

The very public boardroom brawl is casting the limelight on one of Singapore’s wealthiest families with an estimated net worth of $11.5 billion. Besides real estate, the family also holds interests in building materials, diesel engines, finance and packaging.

The family feud was made public last week after the elder Kwek, 84, sued Sherman, 49, for control of the family’s crown jewel, City Developments, which owns such trophy assets as the Republic Plaza tower in Singapore’s Raffles Place central business district and the historic waterfront landmark St. Katharine Docks in London. The chairman also sought to remove Sherman from the post he has held since 2018.

City Developments is headquartered at Republic Plaza, one of the iconic buildings owned by the … [+] Singapore property giant.

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News of the family feud broke after the company reported a 37% decline in 2024 net profit to S$201.3 million ($150.5 million) from the previous year. While CDL’s Singapore portfolio continues to perform strongly and overseas market conditions are stabilizing, the “board tussle clouds near-term outlook,” Vijay Natarajan, an analyst at RHB Bank in Singapore, wrote in a note today.

The elder Kwek alleged that his son and other individuals had “attempted a coup at the board level.” The chairman alleged Sherman 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 nominations committee.

“There has been no attempt by us to oust the chairman,” Sherman countered in a statement on Thursday. Sherman also disclosed that the dispute partly arose over concerns that Catherine Wu, an adviser to his father, had been interfering with the affairs of City Developments’ subsidiary Millennium & Copthorne Hotels and that presented a very serious corporate governance issue.

“Due to her long relationship with the Chairman, efforts that were made to manage the situation were done sensitively, but to no avail,” Sherman said. “This led us, with the benefit of legal advice, to propose a resolution to terminate the advisory agreement Wu has with the board of M&C.”

The case filed by the elder Kwek against Sherman will be heard by Singapore’s Supreme Court in a closed-door session tomorrow. The chairman alleged that Sherman and some board members had bypassed the nomination committee on two occasions in the past weeks. “This is why we had to make the court application,” the elder Kwek said in a statement late Friday. “It was necessary to protect the interests of CDL and its shareholders during this period of significant turmoil.”

The elder Kwek together with his late brother Kwek Leng Joo and their father, Kwek Hong Png, bought loss-making City Developments in 1969 and transformed it into one of the city-state’s largest property developers with S$26 billion of assets across China, Singapore, U.K, and the U.S. 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.’

Kwek Leng Beng.

Hong Leong Group