Kerry Properties dives after revolt

ROBERT Kuok is used the getting what he wants, but the Malaysian tycoon has received a stinging rebuff from minority shareholders in his

In a rare show of activism, they voted on Tuesday to reject a plan to take the company private, putting the skids under its share price. Kerry Properties dived 45 cents or 5.4% to HK$7.90 as the developer resumed trading after the revolt.

Kuok, who is in his seventies, is a towering figure in Hong Kong. Having made an early fortune in sugar and palm-oil trading, he branched out into property development, hotels and media interests. His family's holdings include effective control of both Shangri-La Asia, the hotel management company that runs top-notch sites across the region, and South China Morning Post Holdings, publisher of the Hong Kong broadsheet.

Kuok's Kerry Group, which owns 63.35% of Kerry Properties, pitched its privatisation offer at HK$8.50 a share in April. Although the bid was later sweetened to HK$9.50, there remained a yawning discount to the unit's net asset value of close to HK$18 per share.

Minority shareholder campaigners in the former British colony kicked up a fuss about what they regarded as an effort to take the company private on the cheap. Their resolve was strengthened by an assessment from independent advisers, which also concluded that the offer should be kicked into touch.

Kuok's defeat over Kerry Properties echoes a similar snub delivered earlier this year to Henderson Land Development. Its effort to privatise listed affiliate Henderson Investment was also rejected by minorities.

The Hang Seng index fell 108.2 points to 9900.6, despite Wall Street's overnight gains, which tend to act as signpost for the market's direction. Reflecting the lacklustre mood, global bank HSBC was level at HK$94.25.

In Japan the old economy and the new enjoyed a strong day. For the former, steel stocks surged after a positive forecast from Tokyo Steel Manufacturing, which was quoted, but untraded, up 100 yen or 20% at 603.

Leading the charge was Nippon Steel, the country's largest steelmaker, which bolted 10 yen or 5.8% higher to 180. Brokers said that the optimism was underpinned by swelling exports - especially to the booming China economy - and higher prices. Chinese steel prices are up by about a fifth this year, boosted by rising vehicle production and construction there.

For the new economy, chip-related shares took their inspiration from gains in the US. Toshiba, which makes microchips, firmed 17 yen to 485, better by 3.6%. Advantest, which makes microchip testing equipment, put on 60 yen or 1% to 6200. The Nikkei 225 Average gained 91.39 points or 1% to 9577.36 by late afternoon, before closing at 9615.34, a gain of 129.37 points.

The steel theme was also evident in South Korea, where Posco - the world's number-three steel producer - enjoyed follow-through buying that added 1500 won or 1% to 135,500. It said this week that it plans to raise investments in Chinese joint-venture projects. The Seoul Composite fell 2.07 points to 697.39.