Has Macau’s ‘casino king’ left a King Lear problem?
Or did Stanley Ho learn a lesson from Shakespeare’s King Lear, whose daughters were upset about uneven distribution of his wealth?
Stanley Ho Hung-sun, the Macau casino king, may not have found it difficult to make money but it appears he may have found it hard to split his US$2.5-billion fortune among his 17 children.
The chairman of SJM Holdings, once the only Macau casino monopoly, stepped down last week from the company he started, a month after Steve Wynn also left his casino flagship Wynn Resorts.
But it is unclear if the 96-year-old Ho, who has not been seen in public for nine years, can or has made a succession plan.
On paper, Ho appeared to learn something from Shakespeare’s King Lear, whose daughters were upset about uneven distribution of his wealth.
Ho was replaced by his daughter Daisy Ho Chiu-fung as chairman. He also made his fourth wife Angela Leong On-kei as co-chairman along with Timothy Fok Tsun-ting, son of his late business partner Henry Fok Ying-tung. And he remained as Chairman Emeritus.
But, can a company have four chairpeople?
In a note to clients, JPMorgan Chase analyst DS Kim wrote: “This complicated structure, in our view, leaves room for a potential power tussle within the board, given the lack of clear control”, noting that the proposed board structure was a bit messy.
For the first time, Ho put his different families together in SJM. Other than appointing Daisy, the daughter from his second marriage to the board, his third wife Ina Chan Un-Chan will join the board after his retirement (which takes effect after the 2018 annual general meeting), and fourth wife Angela Leong will also be a board member.
In 2011, Ho gave away 32% of STDM, controlling family of SJM Holdings to his second wife Lucina Laam King-ying and third wife Chan Un-Chan. As a result, Laam owns 14.4% of SJM and Chan owns 8.67%, while fourth wife Angela owns a direct 8.63%.
With Daisy being promoted, all three of Laam’s children own a casino license in Macau. Pansy Ho, chairman of Shun Tak Holdings, is also the co-chairman of MGM China, while her brother Lawrence Ho Yau-lung owns Melco International.
Stanley Ho managed to build his casino empire for four decades before authorities in Macau decided to break his casino monopoly in 2001.
Six casino operators now compete in the world’s largest gaming market but it was the other three operators, Las Vegas Sands, Galaxy Entertainment and Wynn Macau, that dominate the top three spots.
In fact, the market cap of Wynn Macau was larger than that of SJM, Melco and MGM combined.