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CDL Shares Recover As Kwek Leng Beng And Sherman End Legal Dispute, Accelerating Asset Sale Strategy
The relationship between 84-year-old property patriarch Kwek Leng Beng and his 49-year-old son Sherman has shifted from courtroom conflict to strategic alignment. After Kwek initiated legal proceedings against Sherman—who serves as CEO of their flagship company City Developments Ltd. (CDL)—the executive chairman subsequently dropped the case, signaling a unified front to restore market confidence.
The lawsuit had centered on allegations that Sherman appointed board directors without proper vetting procedures from the nominations committee. The timing proved costly for CDL investors, as news of the family dispute triggered a sharp sell-off, pushing the company’s share price to its weakest position in over 20 years.
Turnaround Through Debt Reduction And Strategic Divestments
Both Kwek Leng Beng and Sherman presented a reconciled image during CDL’s August earnings announcement, with the patriarch declaring, “We have moved past previous tensions, establishing a stronger, more cohesive organization.” This public show of unity coincided with the market’s gradual recovery of CDL shares.
The rebound reflects investor optimism around CDL’s aggressive financial restructuring. The company is aggressively tackling its S$13 billion ($10 billion) debt burden through a series of portfolio transactions. In June, CDL divested its controlling stake in South Beach, a mixed-use real estate project located in Singapore’s prime business district, selling its 50.1% ownership to co-developer IOI Properties for S$834 million.
IOI Properties, controlled by Malaysian billionaire brothers Lee Yeow Chor and Lee Yeow Seng, acquired the stake as part of the partnership’s strategic realignment. Sherman revealed during the earnings call that “additional divestment opportunities remain in the pipeline,” suggesting further asset sales are imminent as CDL continues its debt reduction initiative.
The convergence of family reconciliation and aggressive balance-sheet restructuring has positioned CDL to restore investor confidence while strengthening its long-term financial position.