The Cheng family behind New World Development has called for the dismissal of Peter Lau from his role as CEO of Giordano International, the Hong Kong-listed fashion retailer in which a Cheng-controlled vehicle is the largest shareholder.
The clan led by billionaire Henry Cheng wants to remove Lau from the company’s board and his CEO post and appoint Colin Currie as the new CEO and executive director, Giordano said Monday in a requisition notice to the Hong Kong stock exchange.
The Chengs, who hold a 24.06 percent stake in Giordano through Sino Wealth International Ltd, have requested a special general meeting of the company to consider the termination of Lau and the hiring of Currie, a former executive at sportswear maker Adidas. They additionally want to appoint two of Henry Cheng’s children, Christopher Cheng and Sonia Cheng, and one Victor Huang to the Giordano board.
Lau, who is also Giordano’s chairman, said in the HKEX filing that the board is “seeking legal advice as to the appropriate course of action to be taken”.
Failed Takeover’s Aftermath
The Chengs’ boardroom power play comes less than two years after the family tried to take Giordano private via a $327 million buyout offer that was spurned by shareholders including Lau, who personally holds a 1.7 percent stake in the company.
Lau said at the time that he rejected the deal because he didn’t need the cash, Bloomberg reported, citing accounts in the local Hong Kong media.
Giordano suffered sales declines in Greater China amid COVID-related lockdowns in 2022, but the retailer issued upbeat guidance last month, signalling 2023 net profit growth in the range of 21 to 29 percent.
Were he to replace Lau, Currie would bring with him 16 years of apparel experience at Adidas, where he spent his last four years as managing director for Asia Pacific and Greater China. Most recently he led the digital arm of AirAsia parent Capital A for two years.
In a LinkedIn post last November, Currie said his contract with Malaysia-based Capital A would not be renewed following discussions with group boss Tony Fernandes, whom he described as a childhood friend. He said the decision against renewal was a reflection of his and Fernandes’s “mutual satisfaction with the current state of affairs”.
The proposed appointments to the Giordano board of Christopher Cheng, executive director of the family’s infrastructure and construction business NWS Holdings, and Rosewood Hotel Group boss Sonia Cheng come amid unsettled questions surrounding succession at the clan’s property and retail empire.
Henry Cheng revealed last November that he was still looking for a successor to run the family’s business and did not rule out selecting an external candidate, throwing into question the role of his eldest son, Adrian Cheng, who currently serves as CEO of New World Development.
In December, NWS Holdings appointed Henry Cheng’s second eldest son, Brian Cheng, as co-CEO and re-designated Adrian Cheng as a non-executive director of the infrastructure business, in a shift from the first son’s previous role as an executive director. The reshuffle followed shareholders’ approval of an offer by the Cheng family to take NWS private in a HK$35.5 billion ($4.5 billion) buyout.