What forms the basis of HK gambits ... a fun read
Virtual fortune in Tom.com payday
GREN MANUEL
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She held an umbrella over Li Ka-shing's head while he was receiving an
honorary doctorate of laws at a rain-drenched Cambridge University last
June.
Now Chau Hoi-shuen is sitting on Tom.com shares likely to be worth more
than $8 billion - and her hope of fading into the background look doomed.
Not much is known about Ms Chau. Photographs taken of her stint at Mr Li's
side last year show an immaculately dressed woman in her late 30s or early
40s.
She lives in Peak Gardens, Mount Austin Road, and she was involved in the
Beijing Oriental Plaza project, a US$2 billion (HK$15.5 billion)
development in which Mr Li's companies were major investors.
Publications that want to draw conclusions about their relationship may
find themselves suddenly devoid of advertising from Mr Li's companies: Next
magazine, which first reported on the two, found itself bereft of
advertising from ParknShop and other Li companies.
But look into the pages of the Tom.com prospectus and Ms Chau springs to
life.
To start at the beginning: Tom.com is, when all the hoopla is stripped
away, the Web site of Metro Radio station, which is owned by two of Mr Li's
companies.
The spark needed to ignite dotcom fever and make Tom.com into Mr Li's
Internet hot-stock has been created by giving it a catchy Web address,
purchased for at least HK$20 million from a United States firm, kindling
the hope that it will one day turn into, in its own words, "the leading
multi-lingual, China-related new media mega-portal".
This is where Ms Chau has stepped in. Metro sold its Web site for $310
million to Tom.com - not bad for an operation with just two employees.
According to the prospectus, it was Ms Chau who then started signing up
deals that turned Tom.com into something able to claim that it is a
credible Chinese Internet venture, such as getting mainland actor Zhu
Shimao to provide "content" on feng shui, I Ching, the Great Wall and fine
dining.
Ms Chau also sold Tom.com a software firm she started in 1997, in return
for which the two firms controlled by Ms Chau received Tom.com shares.
A series of complex deals over the past few weeks left Ms Chau's companies
holding a total of 920 million Tom.com shares.
If these hit the market at $10 a piece - as some brokers are predicting -
Ms Chau's six-month involvement in Tom.com will leave her with shares worth
more than $9 billion.
Her companies hold, altogether, the same share stake as that held by
Hutchison Whampoa - more than 30 per cent.
She has to shell out five per cent of any profit to her partners, though.
One is consultant Debbie Chang, a 49-year-old American-educated Chinese who
is a director of Oriental Overseas Developments, a company run by Tung
Chee-hwa's family.
Her other partner taking five per cent is a 36-year-old former mainland
customs official, Feng Qi.
But after paying those quotas, Ms Chau will still have shares worth at
least $8 billion.
As would-be Tom.com shareholders stood in the rain on Wednesday in Mongkok
trying to get a few drops of profit from the offering, perhaps they should
have reflected: standing in the rain in Cambridge with an umbrella last
year might have been a better bet.
Gren Manuel is a Post staff writer |
