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12/02/2016 12:47Family Feud Grips Stanley Ho Casino Empire - WSJ

Page 1 of 5http://www.wsj.com/articles/SB10001424052748703555804576102892126323426

HONG KONGA behind-the-scenes power struggle for control of one

of the world's biggest casino empires has burst into the open,

revealing deep fissures in the family of ailing 89-year-old billionaire

Stanley Ho.

Opposing members of Mr. Ho's family brandished contradictory

letterspurportedly signed by the patriarchand publicly accused

each other of trying to seize Mr. Ho's controlling 18% stake in SJM

Holdings Ltd., the Hong Kong-listed operator of his flagship Macau

casinos. The stake is estimated to be worth $1.7 billion.

At the center of the family

feud are two of the most

prominent and powerful

businesswomen in Asia,

part of the sprawling and

occasionally brawling

Stanley Ho clan. Mr. Ho has

acknowledged 17 children

from four different women,

including one who died in

2004. Mr. Ho refers to hischildren's mothers as his

wives, though it is unclear

whichif anyof them are

legally married to the

gambling mogul. These four

families form the core of

the continuing fight.

This time, industry

observers say the quarrel is

being driven by resentmentbetween wife No. 4 , Angela Leong, and Pansy Ho, one of five children

from his second family. A former dancer and local legislator, Ms.

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ASIAN BUSINESS NEWS

Family Feud Grips Ho Casino Empire

Updated Jan. 26, 2011 12:01 a.m. ET

By SHAI OSTERAnd KATE O'KEEFFE

ALL IN THE FAMILY

Mr. Ho has a complicated family tree,

which includes four women whom he

and others refer to as his wives.

Ownership of parts of his empire by

the women and their children have

complicated the outlook for SJM's

succession.

Hong Kong and Macau tycoon Stanley Ho, in

wheelchair, with some family members in November

ASSOCIATED PRESS
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Leong holds an executive position in the family's flagship casino

operation that was strengthened late last year when Mr. Ho gave her

shares that boosted her stake to 8%, making her a top contender to

control the casino business.

On the other side is Pansy Ho, widely regarded as the head of the

second family faction. She has launched her own gambling franchise

and is managing director of Shun Tak Holdings Ltd., the listed

property and real-estate firm founded by her father. Pansy's siblings

Daisy and Maisy hold executive positions at Shun Tak as well. Pansy's

brother, Lawrence Ho, has set up a rival Macau casino. Together, those

siblings form a block in the complicated holdings of Mr. Ho's empire.

SJM Holdings didn't

respond to requests for

comment. The company

said in a regulatory filing

that the quarrel wouldn't

affect its management orstrategy.

Questions over Mr. Ho's

legacy began when he fell ill

in August 2009 and

underwent brain surgery.

He retreated from day-to-

day management and began

slowly doling out portions

of his Byzantine holdings to

his family.

Depending on which side

wins, Ms. Leong could

emerge with an even bigger

stake and the upper hand in

the casino. Or, the children

of the second wife, Lucina

Laam, could have a larger

and possibly controlling

block in SJM. Macau law

forbids holding more thanone casino license, so it is

unclear whether Pansy Ho

wants to take the reins of

her father's business.

A person close to the Ho

family said Pansy aligned with Mr. Ho's low-profile third wife, Ina

Chan, to counter Ms. Leong's rising power. In correspondence made

public by his second and third families, Mr. Ho reaffirmed that he

would make a gift of his stake in his casino empire to his second and

third families.

The release on Monday of regulatory filings showed Mr. Ho had split

MORE

Exchange: SJM Shares Plunge

(http://blogs.wsj.com/exchange/2011/01/26/stanle

y-ho-drama-escalates-overnight-sjm-shares-

plunge/#) | Saga in Memos

(http://blogs.wsj.com/exchange/2011/01/25/the-

ho-saga-in-memo-form/)

New Letters in Stanley Ho Saga Emerge

(/articles/SB100014240527487046980045761

04282322789502)

Letters: Daisy Ho

(http://online.wsj.com/documents/macauletter0125

.pdf) | Stanley Ho

(http://online.wsj.com/documents/macauletter2012

5.pdf)

Video:Potential Successors

(http://online.wsj.com/video/stanley-ho-gives-up-

sjm-shares/C751E66B-4AB7-4118-8008-1540DAFD8E89.html)

Interactive:All in the Family

(/articles/SB100014240527487033985045761011

01504388170#articleTabs%3Dinteractive)

A Who's Who of Stanley Ho's Family

(/articles/SB100014240527487046980045761

04383453856532)

Macau's Biggest Players

(http://blogs.wsj.com/hong-

kong/2011/01/24/macaus-gambling-kings/) |

Topics Page:Stanley Ho

(http://topics.wsj.com/person/H/stanley-ho/5386)

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his own SJM stake

roughly in two, with

slightly less than

half going to the

children of the

woman he considers

his second wife and

the rest to thewoman known as his

third wife, leaving

Mr. Ho with nearly

nothing.

But in a

surprising reversal, lawyers claiming to represent Mr. Ho later denied

he had ever authorized the restructuring of his holding company and

accused the second and third families of having "hijacked" his shares

without his knowledge and threatened to sue his children to get them

back. Instead of a two-way split, Mr. Ho said in a letter provided by

lawyers at his law firm, Oldham, Li & Nie, that he always planned to

share his part of the company in four equal segments among the

families. "This has always been my intention and wish," Mr. Ho wrote

in a letter dated Jan. 5 that was provided by the law firm, and

addressed to Daisy Ho, a daughter from his second wife.

Then on Tuesday, representatives of families two and three released

personal communications from Mr. Ho and his four families to prove

their claim to a controlling stake in Lanceford Co., a vehicle that holds

nearly one-third of Sociedade de Turismo e Diversoes de Macau, the

company that controls SJM. The holders in the stake stand to benefit

from a gambling boom in Macau, where revenue is expected to risesome 30% this year to about $35 billion, compared with $7 billion on

the Las Vegas Strip.

In the note, Mr. Ho complained to his daughter that she hadn't been

returning his phone calls. "I have tried to call you and contact you

through [text messages] and your secretary in order to come

personally to explain to me what is going on. However, you have not

responded so I have no other way but through this letter to command

you to come to my house," he wrote.

Then, families two and three responded with a letter dated Jan. 7. In it,

Daisy Ho replied to her father's allegations, addressing him as "Dear

Dad."

Casinos rise from the skyline of Macau, China. BLOOMBERG NEWS

MACAU'S BIGGEST PLAYERS

Market Share: See a

slideshow of Macau'sgambling kings.

SJM's Grand Lisboa

AFP/GETTY IMAGES
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"Firstly, I want to apologise for not being able to see you on

Wednesday afternoon as I was very tied up," she wrote, adding that her

sister and wife No. 3 did meet him later that evening, "and I am glad

that any misunderstanding there might have been has been cleared

up."

In another twist, early Wednesday morning in Hong Kong,

representatives of Mr. Ho's second and third wives released two

Chinese-language letters, one of them purportedly handwritten by

Mr. Ho on Tuesday, saying that the tycoon was firing the law firm

Oldham, Li & Nie and that the share transfer hadn't been made under

any undue influence and that the splitting of his empire was final.

"The recent stir over the Ho family has caused an uproar. I think it's

time to put an end to this," he said in the handwritten note. "Family

matters should not involve lawyers, and suing one another in the

courts is troublesome! I also hope the media will not misunderstand.

My health is very good, and there's no need for anyone to be

concerned."

In the other statement, Mr.

Ho said his decision to

divide the Lanceford stake

was his alone. "Under no

circumstances, did I receive

any pressure or orders from

anyone," the statement

said.

Stanley Ho couldn't be

reached for comment. Ms.

Leong during an interview

with a local radio station

declined to comment on the

latest power struggle but added that Mr. Ho was in good health and

clear-minded. Other family members either couldn't be reached or

declined to comment. Representatives of Oldham, Li & Nie couldn't be

reached for comment.

Trading in SJM shares was suspended Tuesday. Royal Bank of

Scotland Group PLC gambling analyst Philip Tulk said shares in SJM,which have more than tripled in the past year, could fall when trading

resumes. "Ever since I've been covering this company, the concern has

been about Stanley's succession plan. Those worries seemed to be

going away, but now they look like they could come back with a bang,"

Mr. Tulk said.

The verbal back and forth could develop into a protracted legal battle

among members of the tycoon's family, said Billy Ma, a lawyer

specializing in probate and succession cases and a member of the

Hong Kong Law Society's Probate Committee. "Any move at this stage

can potentially unleash a chain of lawsuits. This is about a hugeamount of money," he said.SJM's properties include 20 casinos, four

slot-machine lounges and two hotels.

GAMBLING EMPIRE

See a timeline of Mr. Ho's casinos

business.
http://www.wsj.com/news/interactive/MACAU0111


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Polly Hui

and Jonathan Cheng contributed to this article.

Write to Shai Oster at [email protected] and Kate O'Keeffe at

[email protected]

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