CDL's Reign Ends: Feud with Kwek Slashes Market Cap
1min read City Developments Limited (CDL), a Singapore-based real estate developer, has lost its position as the country's largest developer by market capitalization following a public feud with its largest shareholder, Kwek Leng Beng. The dispute, which has been ongoing for several months, has led to a significant drop in CDL's share price and a subsequent decline in its market capitalization.
The feud began when Kwek, who is also the chairman of cdl, publicly criticized the company's management for its handling of a proposed acquisition of a prime piece of land in Singapore. Kwek, who owns a 33% stake in CDL, accused the management of not acting in the best interests of the company and its shareholders. The management, led by CEO Sherman Kwek, a nephew of Kwek Leng Beng, has maintained that the acquisition was a sound business decision and that the company's interests were being protected.
The public spat has taken a toll on CDL's share price, which has fallen by more than 20% since the beginning of the year. This decline has led to a significant drop in CDL's market capitalization, which has fallen from around S$12 billion to less than S$10 billion. As a result, CDL has lost its position as the country's largest developer by market capitalization, a title it has held for many years.
The feud has also had an impact on CDL's credit rating, with Moody's Investors Service downgrading the company's credit rating from Baa1 to Baa2 in March. The downgrade was due to the uncertainty surrounding the company's management and the potential impact of the feud on its financial performance. CDL has since announced that it will be conducting a strategic review of its business, which is expected to be completed by the end of the year.
The future of CDL remains uncertain, as the feud between Kwek Leng Beng and the company's management continues to play out in public. The company's shareholders will be watching closely to see how the situation develops and what impact it will have on the company's financial performance. In the meantime, CDL will need to work hard to rebuild its reputation and regain the trust of its shareholders and the market.
