Casino jackpot that has a family at odds
The 'King of Macau' is ceding control of his vast gambling empire – so who will replace him? Clifford Coonan on a dynastic battle
Wednesday 26 January 2011
The battle for Asia's biggest casino empire is threatening to tear apart the family of Stanley Ho, as the 89-year-old "King of Macau" says his relatives have divided up the gambling empire he created without his consent.
In an epic struggle with shades of the soap opera Dallas, Mr Ho has found himself at odds with his children and fighting to keep control of the casino operator Sociedade de Jogos de Macau Holdings (SJM), which he built up over five decades.
And with four "wives" and 17 children, there are plenty of potential challengers to his crown. The controversy began after SJM informed the Hong Kong stock exchange on Monday that Mr Ho had transferred to family members all but 100 shares of his roughly 32 per cent stake in SJM's parent company, STDM.
Mr Ho's lawyers said he "discovered much to his horror" that his 100 percent ownership of Lanceford Co. – which holds the 32 per cent stake in STDM – had been diluted after new shares were issued, reducing his share to one per cent, the South China Morning Post reported.
Half of the shares in Lanceford were then transferred to a company owned by Mr Ho's third wife Ina Chan, and the other half to another company owned equally by the five children by his second wife Lucina Laam – Pansy, Daisy, Maisy, Josie and Lawrence.
All this went on, Mr Ho claims, without his consent, and he has instructed his lawyers to take action against family members. While he concedes that he signed a document, he says no one explained what the effect would be.
The transfer of his assets went against Mr Ho's wishes to divide them equally among his 16 children, his lawyer Gordon Oldham told the South China Morning Post.
"What really upsets him is that he's not even dead yet, but in the twilight of his life his second and third families appear to be squabbling and pinching it for themselves," Mr Oldham told the paper. "There's no doubt that he has all his faculties."
The family denies seizing Mr Ho's shares, saying the billionaire approved the transfer of his holdings in STDM.
There is a lot at stake. SJM is Asia's largest casino operator, running 20 casinos in the world's biggest gambling market.
Macau is the only place in China where gambling is legal. Mr Ho was ranked Hong Kong's 13th richest man with a net worth of £1.96bn by Forbes magazine earlier this month.
The patriarch has been getting his affairs in order since spending seven months in hospital in 2009.
Mr Ho reportedly had brain surgery after hitting his head in a fall, and has rarely appeared in public since. Last month he transferred his 7.7 per cent stake in SJM to Angela Leong, the mother of his five youngest children, after he was released from hospital.
The complicated nature of Mr Ho's family structure means a murky succession battle has always been on the cards.
His first wife, Li Wan Hua, died in 2004 at the age of 80. His other three "wives" – Lucina Laam, Ina Chan and fourth wife Angela Leong – are not formally married to him, but are generally referred to as his spouses.
The succession battle is hitting the company, and analysts at investment banks have downgraded the company on fears that the row could distract the management.
Many of his children have a high profile themselves in Asia. Pansy Ho is the Macau partner of the US company MGM Resorts International, while Josie Ho is an actress and singer. His son Lawrence is CEO of Melco Crown Entertainment, a casino operator which is a joint venture with Australia's Crown Ltd.
He has had family problems before, having long been embroiled in a lawsuit with his sister Winnie over control of his assets.
Mr Ho is something of a legend in the former Portuguese enclave. He first made his fortune smuggling goods between China and Macau during the Second World War. Once his boat was captured by pirates and the crew killed, but he managed to take a gun from his captors and seize back his vessel.
Mr Ho began to build his gambling empire back in the early 1960s, when he bid for the Macau gaming monopoly that the Portuguese put up for grabs in what was then a sleepy colony, overshadowed by Hong Kong.
Once he secured the concession, he began to transform Macau, commissioning high-speed ferries to bring high rollers from Hong Kong.
Throughout his career he has been accused of having links with Triad gangs in Macau, though he denies the accusations. Certainly some of the big Triad figures, such as the notorious "Broken Tooth" Koi, were regular visitors to the Lisboa casino during the heady days of the 1990s before the Las Vegas crew came to town.
The alleged links to organised crime have also caused problems for the children. Because of her associations with the family business, New Jersey casino regulators last year deemed Pansy Ho too close to organised crime to be a partner with New Jersey casino licence holders.
Foreign operators such as billionaire Sheldon Adelson's Las Vegas Sands Corp came to Macau after the city's government ended Mr Ho's monopoly in 2004.
He responded to the loss of SJM's monopoly in the territory and the advent of Las Vegas interlopers by building the Grand Lisboa, which looms over the whole of the territory, like a reminder to the Nevada arrivistes of where the whole story started.
A family affair...
Ho's fourth wife is a dancer and the biggest individual shareholder of SJM Holdings Ltd.
Born to Ho and his second wife, he is the CEO of Macau gaming firm Melco Crown Entertainment.
One of Asia's most influential businesswomen, she maintains a partnership with MGM Resorts.
Ho's third wife, also known as Chan Un-Chan, now owns a majority stake in the firm that controls casino giant SJM Holdings Ltd.
The 89-year-old's $3.1 billion gambling empire held monopoly rights over Macau's casinos since the 1960s. He had four wives and 17 children.
Ho's daughter from his second wife is managing director of the property and transportation wing of the Ho empire, Shun Tak Holdings Ltd.
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