Li Ka-shing

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This is a Chinese name; the family name is 李 (Lǐ).

Sir Ka-shing Li, GBM, KBE, JP (traditional Chinese: 李嘉誠; simplified Chinese: 李嘉诚; pinyin: Lǐ Jiāchéng, Jyutping: Lei⁵ Gaa¹-sing⁴, Li² Gia¹-sêng^{5 gdr}, born June 13, 1928^[3][4]), is a wealthy businessman from Hong Kong. He is the richest person of East Asian descent in the world and the sixteenth richest man in the world with an estimated wealth of US$16.2 billion on 13 February 2009. Presently, he is the Chairman of Hutchison Whampoa Limited (HWL) and Cheung Kong Holdings; through them, he is the world's largest operator of container terminals and the world's largest health and beauty retailer.^[5]

Considered one of the most powerful figures in Asia, Li was named "Asia's Most Powerful Man" by Asiaweek in 2001. His companies make up 15% of the market cap of the Hong Kong Stock Exchange.[4] Forbes Magazine and the Forbes family honored Li Ka-shing with the first ever "Malcolm S. Forbes Lifetime Achievement Award" on September 5, 2006, in Singapore.^[6] In spite of his wealth, Li has cultivated a reputation for leading a no-frills lifestyle, and is known to wear simple black dress shoes and an inexpensive Seiko wristwatch, which is at odds with the house he owns in one of Hong Kong's most expensive precincts, Deep Water Bay. Li is also regarded as one of Asia's most generous philanthropists, donating over US $1.41 billion to date to charity and other various philanthropic causes. ^[7]

Li is often referred to as "Superman" in Hong Kong because of his business prowess.^[8] His peers in Hong Kong include Lee Shau Kee of the Henderson Land Development, New World Development's Cheng Yu-tung, casino and property magnate Stanley Ho, the Kwok family of Sun Hung Kai Properties, and Henry Fok Ying-tung, among others.

[edit] Early life

Li Ka-shing was born in Chaozhou in the Guangdong Province, Republic of China in 1928. In 1940 the Li family fled to Hong Kong to avoid the turmoils in China.^[9] Li's family stayed at the home of his wealthy uncle. The success of Li's uncle with his immense wealth ignited Li's determination to make a place for himself in the world^{[citation needed]}. Li married Chong Yuet Ming, his first cousin and the daughter of the wealthy uncle.

Li's father died in Hong Kong. Shouldering the responsibility of looking after the livelihood of the family, Li was forced to leave school before the age of 15 and found a job in a plastics trading company where he labored 16 hours a day. By 1950 he was able to start his own company, Cheung Kong Industries. From manufacturing plastics, Li led and developed his company into a leading real estate investment company in Hong Kong that was listed on the Hong Kong Stock Exchange in 1972. Cheung Kong expanded by acquiring Hutchison Whampoa and Hongkong Electric Holdings Limited in 1979 and 1985 respectively.^[9]

[edit] Businesses

A Harvard Business School article summarizes Li's career in the following way:

Li's businesses cover almost every facet of life in Hong Kong, from electricity to telecommunications, from real estate to retail, from shipping to the Internet. The Cheung Kong Group's market capitalization is HK $647 billion (US $82.9 billion) as of December 2009 (This includes some double counting of the Group’s controlling stake in 12 listed companies around the world). The group operates in 55 countries and employs over 260,000 staff worldwide.

[edit] Plastics manufacturing

In 1950, after learning how to operate a plant, Li founded a plastics manufacturing company in Hong Kong with funds borrowed from family and friends and contacts he cultivated as a salesman. Li avidly read trade publications and business news before deciding to supply the world with high quality plastic flowers at low prices. Li learned the technique of mixing colour with plastics that resemble real flowers. After retooling his shop and hiring the best technicians he could find, he prepared for weeks for the plant visit of a large foreign buyer. Impressed with the quality of Li's plant, the buyer placed a large order. A few years later, Li grew to be the largest supplier of plastic flowers in Asia and made a fortune selling them. [5]

[edit] Real estate

In 1958, unable to renew the lease for his company, Li was forced to purchase and develop a site by himself. An opportunity to acquire last arrived after the 1967 riots were in full swing, many fled Hong Kong. As a result, property prices plummeted. Li, believing the political crisis would be temporary, and property prices would eventually rise, bought parcels of land at low prices. By 1971, Li officially named his real estate development company Cheung Kong (長江實業), named after Cheung Kong, (Chang Jiang or the Yangtze River) the longest river in China.^{[citation needed]}

In the spring of 1992, Deng Xiaoping traveled to Shanghai and Guangdong and delivered public speeches. He said that People's Republic of China was implementing an open door policy and welcomed foreign investments. After Deng’s southern tour, Li’s group began to make large scale investments in the mainland. ^[11] Cheung Kong Holdings was publicly listed in Hong Kong Stock Exchange in 1972. During board meetings, Li stated on a number of occasions his goal of surpassing the Jardines-owned Hongkong Land as a leading developer. ^[12]

The successful bid by Cheung Kong for development sites above the Central and Admiralty MTR stations in 1977 was the key to challenging Hongkong Land as the premier property developer in Hong Kong. Despite its size, Jardines decided in the 1980s to protect itself from hostile takeover by Li or other outside investors. The company implemented a cross-shareholding structure that was designed to place control in the hands of Britain's Keswick family despite their less than 10% holdings in the group. In 1984, the company also moved its legal domicile from Hong Kong to another British overseas territory - Bermuda, in anticipation of the transfer of sovereignty of Hong Kong to Communist China in 1997.^{[citation needed]}

[edit] Ports and electricity

In 1979, Li closed a unique transaction and acquired his current flagship company Hutchison Whampoa Limited from HSBC. The purchase created a massive conglomerate with business interests in multiple industries. The most notable branch of his business is the investment in container port facilities around the world, including in Hong Kong, Vancouver, Canada, China, UK, Rotterdam, Panama, Bahamas and many developing countries. All in all, his business controls 13% of all container port capacity in the world.^{[citation needed]}

[edit] Retail

A subsidiary of Hutchison Whampoa, the A.S. Watson Group is a leading retail operator with over 7,800 stores. Its portfolio encompasses popular retail brands in Europe such as Superdrug (UK), Marionnaud (France), Kruidvat (Benelux countries), and in Asia including health & beauty specialist Watson's Your Personal Store, PARKnSHOP supermarkets, Great Food Hall, TASTE food galleria, gourmet boutique style fine food hall, Fortress electrical appliance stores, Watson’s Wine Cellars and Nuance-Watson airport duty free shops. ASW is also a major producer and distributor of water products and beverages in the region with Watsons Water the top selling brand in Hong Kong.^{[citation needed]}

[edit] Asset trader

Hutchison Whampoa group has the reputation of being an astute asset trader. It frequently builds up new businesses and sells them off. Huge profits were obtained in the sale of its interest in Orange to Mannesmann Group in 2001, making a profit of $15.12 billion. In 2006 Li sold 20% of Hutchison's ports business to Singapore rival PSA Corp., making a $3.12 billion profit on a $4 billion deal.^[13]

Recently Hutchison Telecommunications, nearly 50 percent owned by Hutchison Whampoa, sold a controlling stake of 67% in Hutchison Essar, a joint venture Mobile operator in India, to Vodafone for $11.1 billion. It had invested roughly $2 billion earlier.^[14]

[edit] Pyramid structure

Like many Asian conglomerates, the Li Ka-shing group is structured to retain disproportionate control without incurring the cost of owning an equivalent economic interest. This separation between control and interest is accomplished through pyramid structure, dual-class equities and cross-holdings.^{[citation needed]} While such structures are rarer in the US and UK, they do exist. For instance, Google uses a dual-class structure to give its founders and insiders 10 votes for each class-B share while the general public is offered class-A shares with 1 vote each.

[edit] Internet

His investment company, Horizon Ventures bought a stake in doubleTwist.^[15] Li Ka Shing Foundation bought a 0.8% stake in social networking website Facebook for $120 million in two separate rounds. ^[16][17] and invested an estimated $50 million in music streaming service Spotify.^[18] Sometimes between late 2009 and early 2010, Li Ka-shing led a $15.5 million Series B round of financing for Siri, an artificial intellgence based virtual personal assistant application for the iPhone.^[19]

[edit] Others

Besides business through his flagship companies Cheung Kong Holdings and Hutchison Whampoa, Li Ka-shing also personally has extensively invested in real estate in Singapore and Canada. He was the single largest shareholder of Canadian Imperial Bank of Commerce (CIBC), the third largest bank in Canada until the sale of his share in 2005 (with all proceedings donated, see below). He is also the majority shareholder of a major energy company, Husky Energy, based in Alberta, Canada.^{[citation needed]}

In January 2005, Li announced plans to sell his $1.2 billion CAD stake in the Canadian Imperial Bank of Commerce, with all proceeds going to private charitable foundations established by Li including the Li Ka Shing Foundation in Hong Kong and the Li Ka Shing (Canada) Foundation based in Toronto, Canada.^[20]

Li has some real estate interest in Vancouver, specifically in connection with Concord Pacific Place on the old Expo '86 lands in Yaletown.^{[citation needed]}

[edit] Family

His two sons Victor Li and Richard Li are also prominent figures in the Hong Kong business scene. Victor Li works directly with his father as managing director and deputy chairman of Cheung Kong (Holdings) Limited, while Richard Li is the head of PCCW, the largest telecom company in Hong Kong. They are both Canadian citizens.

[edit] Personal Life

In the 1990's he used to wear a $50 Citizen watch and plain ties. [6] The biggest enjoyment for him is to "work hard and make more profit."

[edit] Awards and honours

• Grand Bauhinia Medal
• Knight Commander of the Order of the British Empire
• Commander, Légion d'honneur

[edit] Philanthropy

Li is also a noted philanthropist. In 2006, Li pledged to donate one-third of his fortune to charity and philanthropic projects throughout the world -- a pledge estimated at over US$10 billion.^[21]

• His donation in 1981 resulted in the founding of Shantou University, near his hometown of Chaozhou.

• Li was invited by Chinese leader Deng Xiaoping to become a member of the board of directors of the China International Trust and Investment Corporation (CITIC) to support the economic reform initiatives that Deng was attempting to develop. CITIC is China's largest conglomerate and is 42 percent owned by the government of China. It serves as the chief investment arm of China's central government and holds ministry status on the Chinese State Council. Li served only one year on CITIC's board before resigning his directorship. He was the non-executive director of The Hongkong and Shanghai Banking Corporation since 1980 and became Deputy Chairman of the bank in 1985. He was also Deputy Chairman of HSBC Holdings in 1991-1992.

• The Li Ka Shing Library at the Singapore Management University is also named in his honor after a US$11.5 million donation in 2002 to the higher education institution.^[22]

• After the 2004 Indian Ocean Earthquake disaster, he reportedly pledged a total of US$3 million.

• In 2005, Li announced a HK$1 billion (US$128 million) donation to the Faculty of Medicine, University of Hong Kong. It was renamed to Li Ka Shing Faculty of Medicine on January 1, 2006 which provoked controversy between the university and a few alumni of the faculty, notably Kwok Ka Ki, over the naming procedures of the university.

• Also in 2005, Li donated US$40 million to the University of California, Berkeley, citing that he was impressed with the university's accomplishments in the biosciences. In recognition of Li's donation, the university has named the campus's new biosciences facility the Li Ka Shing Center for Biomedical and Health Sciences; it is currently under construction.^[23]

• Moreover, on March 9, 2007, Li Ka-shing contributed $100 million to the Lee Kuan Yew School of Public Policy in the National University of Singapore. Also, "to honour and recognise Dr Li's support and generosity, LKY SPP will name one of its three buildings at the historic Bukit Timah Campus after him".^[24]

• Li Ka-shing donated CAD$25 million to St. Michael's Hospital in Toronto to found the Li Ka-Shing Knowledge Institute, which will serve as a medical research and education centre in downtown Toronto. ^[25]

• Li Ka-shing (through the Li Ka-shing foundation) donated 30 million HK dollars (3.85 million U.S. dollars) to aid relief efforts in the 2008 Sichuan earthquake ^[26]

To date, Mr. Li has given away well over (US)$1 billion in philanthropy via his Li Ka-Shing Foundation and other private charitable Foundations ^[27]

[edit] See also

• The Hongs
• List of Hong Kong people by net worth
• List of billionaires

[edit] Press

• Time Asia ^[28]
• Chronicle of Philanthropy ^[29]
• Wall Street Journal ^[30]
• Financial Times (UK) ^[31]
• L'Expansion (French Press) ^[32]

[edit] References

[edit] External links

• Li Ka-shing Biography, Reference for Business
• Cheung Kong Holdings Limited
• Hutchison Whampoa Limited
• Li Ka Shing Foundation - founded by Li Ka-shing, dedicated to funding education and medical care.
• World's Most Powerful Men
• New Ruler of the Information Superhighway