Analysis
THE HONGKONG LAND COMPANY LTD
WHERE'S YOUR SAVVY NOW?
Questions could, perhaps, be asked today as to whether or not shareholders of The Hongkong Land Company Ltd could make a claim of mismanagement against the management of the company.
It appears that The Land Company has failed to come anywhere close to cashing in on a number of property developments around town, and has furthermore failed to come anywhere close to maximizing the profit on a number of property deals it has put through.
Although it is well known that the company was trying to consolidate by selling off a large chunk of its properties over the last couple of years, the fact that several of those very same properties were re-sold by the buyers almost immediately for a tidy profit brings into question the foresight, or perhaps the lack thereof, of The Land Company's management.
Consolidation of a company when market pressures dic- tate such a move is one thing, but chucking away assets, the capital value of which would appreciate considerably in a very short time, is another.
Bond Corporation International Ltd (BCIL) bought a large part of The Land Company's prime residential property portfolio for about $HK1.43 billion in October 1986.
Before the ink had had time to dry on the Sale and Purchase Agreement, BCIL had sold Clovelly Court in Mid- Levels to Lambda Technology Ltd, now known as Scilla Holdings Ltd.
The capital value of Clovelly Court was about $HK203 million when BCIL bought The Land Company's property portfolio.
Lambda paid $HK245 million for the property.
Therefore, the sale of Clovelly Court threw up a surplus
of $HK42 million for BCIL.
In other words, this represents a 20.65-percent return for BCIL from the property within a few weeks!
مع
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Clovelly Court: A big buy for Bondie
as The Land Company misses a trick
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