Cheng heir resigns as Ma steps in

Themis Qi

Adrian Cheng Chi-kong is stepping down as New World Development chief executive and assuming the role as nonexecutive vice chairman, the property developer has announced.

New World is also selling the right to provide management services in properties under the K11 brand and related businesses to Adrian Cheng - the eldest third-generation heir in the family - for HK$209 million.

New World said it will focus on property development.

Speaking at New World's results audio briefing yesterday, Cheng said he has tendered his resignation as CEO, executive director and executive vice chairman in the family company he joined in 2007.

He added he intends to spend more time on public services and other personal commitments.

New World also confirmed that chief operating officer Eric Ma Siu-cheung has been appointed as the new CEO.

Now is a good time to "start again," he said at the briefing.

Ma worked as secretary for development in 2017 and joined New World in 2018 to lead NWS Holdings - another company owned by the Cheng family - until January 2024.

Adrian Cheng said he will devote more time to making a greater contribution to Hong Kong and the mainland and expressed his gratitude to his father, Henry Cheng Kar-shun, for his support.

Besides being nonexecutive vice chairman, Adrian Cheng will also be a nonexecutive director.

Henry Cheng, who chairs New World, said he "very much" respects and supports the decision of his eldest son. He added in a statement: "We will also set up a management committee to support the group's business development as well as elevate corporate governance standards to create greater value for both our shareholders and society. I am fully confident in the group's future."

Among Henry Cheng's four children, only daughter Sonia Cheng Chi-man - as executive director - has a seat at New World's board. Sonia Cheng is responsible for hotel development, including the luxury project Rosewood.

Adrian Cheng's younger brother Brian Cheng Chi-ming, an executive director and co-chief executive officer of NWS Holdings and a nonexecutive director of New World, on Wednesday hinted at the personnel changes.

At the NWS Holdings' results briefing, he said if he did not perform well he "would be replaced by his father, who is fair in handling business."

New World yesterday reported a net loss of HK$11.8 billion from continuing operations and HK$7.9 billion from discontinued operations for the year ending in June, versus a net profit of HK$548 million during the previous 12-month period.

Its full-year revenues from continuing operations also dipped 34 percent year-on-year to HK$35.8 billion due to fewer bookings from property development in both Hong Kong and the mainland.

New World declared no final dividend for the past financial year.

New World said it will dispose of five entities related to K11 and the right to provide management services at the shopping mall brand to a unit owned by Adrian Cheng.

New World still owns the properties under K11 and regards the project as a success, Ma said yesterday.

Ma added that the spin-off of services management will be trendy and can help the developer in operation efficiency and cost control.

New World also plans to sell all its equity interest in Kai Tak Sports Park to its controlling shareholder Chow Tai Fook Enterprises. Last year, the developer sold its stake in NWS to CTFE to reduce debt.

themis.qi@singtaonewscorp.com