HK tycoon David Li resists activist investor Elliott's attack on BEA
By Elzio Barreto and Denny Thomas
HONG KONG (Reuters) - Bank of East Asia (BEA) (0023.HK: Quote) shareholders approved all resolutions put at its annual meeting on Friday, rejecting calls by U.S. activist investor Elliott Management Corp to defy the board, although one resolution was not put to the vote, but withdrawn instead.
The shareholder votes on proposals that included renewing some directors' tenures and a mandate to issue new shares pitted the $27 billion hedge fund firm founded by billionaire Paul Singer against BEA's chairman and former politician David Li, whose grandfather founded the bank nearly 100 years ago and whose family is among the Hong Kong's best connected.
BEA said in a securities filing all resolutions were approved, though votes against the renewal of the general mandate to issue new shares were up on last year.
The dispute illustrates the growing tension between minority shareholders in Asia pushing for better returns and transparency and local conglomerates used to running their publicly listed businesses with less scrutiny over corporate governance than is typical in the United States and Europe.
Elliott, a BEA shareholder for five years, has built a 7 percent stake and says the stock's underperformance is down to weak management.
BEA is the last big family-run bank in Hong Kong, but its profitability lags its listed peers, and in February Elliott called for the bank be put up for sale.
Friday's shareholders meeting was the first since that call, and Li, a familiar sight on Hong Kong roads in his Rolls-Royce with its "DL 1" license plate, had said he was prepared for a scrap.
"Elliott is personally challenging me. I will stand up for a good fight," he said at the annual results briefing in February. Continued...