Chen Nan Lok, executive director of Swire Pacific Ltd, Deputy Chairman and Non-Executive Director of Cathay Pacific Airways Ltd, has decided to leave the Swire group at end-June after serving the group for 33 years, citing his desire to pursue other interests as the main reason.

In the announcement issued by Swire Pacific Ltd, the Group said that "Mr Chen has confirmed that he is not aware of any matter relating to his resignation that needs to be brought to the attention of the shareholders of the Company. Mr Chen confirmed that his resignation is due to his decision to pursue his personal interests and that he is not aware of any disagreement with the Board."

"It has been a most difficult decision, as I am leaving a group I have served for 33 years, since graduation from University," Chen said after announcing his resignation from all of his duties in the Swire group.

Chen joined the group in 1977 after graduation and, in addition to Hong Kong, worked with the group on the mainland and elsewhere in the Asia Pacific region.

Security analysts said that the departure of Chen will not exert long-term negative influences on the long-term business prospects for Swire Pacific and Cathay Pacific.

"In traditional British-controlled conglomerates like Swire Pacific, it is not unusual to have top-level personnel changes, Chen's resignation will not affect the long-term strategic business development of the group, although the news may exert short-term psychological setback effects on the stock," Dickie Wong, research manager of Kingston Security told China Daily.

Regarding Cathay, even the recent disruption of European services of the carrier caused by volcanic ash being spewed by the eruption in Iceland has not done any harm to the share price, as Chen's resignation will leave the company structure intact. Accordingly, Cathay's buisness prospects will remain unchanged, Wong predicted.

Swire Pacific A-shares shed 2.181 percent to close at HK$91.95 yesterday, with a turnover of HK$474.401 million, while the share price of Cathay Pacific slipped slightly by 0.883 percent to HK$15.72, with a turnover of HK$100.132 million.

Meanwhile, market sources said that the property arm of Swire Pacific, Swire Properties, has received approval from the Hong Kong Stock exchange for an initial public offering to raise $3 billion. It will start the roadshow on April 26th, with trading of the shares scheduled to begin on May 14, sources said.

"Swire Properties is a world-class property developer with a good property investment portfolio mix in Hong Kong and the mainland, so the stock will be a good medium inflation hedge investment tool," Wong told China Daily, adding that recent stringent measures curbing excessive bubbles in the property market on the mainland may inhibit Swire Properties from over-pricing its IPO shares, which will make the investment relatively attractive.

"Anyone who is bullish on the local and mainland property market in the future should find Swire Properties attractive, as the spin-off of the property arm of the Swire Group will unleash the potential values of the assets", Jasper Tsang, research manager of CSC Securities (HK) told China Daily.

China Daily

(HK Edition 04/20/2010 page2)