Hong Kong’s New World Development has announced the replacement of CEO Eric Ma after only two months on the job. The company, owned by one of Hong Kong’s wealthiest families, reported a significant annual loss of over US$2.5 billion in late September, leading to Ma’s appointment as CEO. However, Ma has decided to step down from his position to focus on personal commitments.
In a statement released on Friday, New World Development revealed that executive director Huang Shaomei, also known as Echo Huang, will take over as the new CEO for a term of three years. Patriarch Henry Cheng expressed his satisfaction with the appointment, highlighting Huang’s extensive experience in real estate and corporate management. The company emphasized the need for timely changes in its development direction, leading to the adjustment in the CEO role.
Following the announcement, New World’s share price experienced a six percent drop before trading was halted. The company stated that trading will resume on Monday, indicating the market’s reaction to the leadership change. New World Development, primarily known for its property arm, faces challenges in a declining property market in Hong Kong, resulting in its removal from the Hang Seng Index next month.
Despite Ma’s departure, Morningstar analyst Jeff Zhang believes that it will not significantly impact the company’s operations. Zhang predicts that New World will continue to focus on residential sales and asset divestment to reduce its debt levels. Recently, the developer sold its stake in Hong Kong’s largest sports complex, the Kai Tak sports park, to a family-owned investment vehicle.
New World Development’s restructuring reflects the company’s efforts to navigate through a challenging market environment in Hong Kong. With the appointment of Echo Huang as the new CEO, the company aims to realign its strategies and drive future growth in the real estate sector.
As New World Development transitions to new leadership, investors and stakeholders will closely monitor the company’s performance and strategic direction. The market response to the CEO change indicates the importance of effective leadership in steering the company towards sustainable growth and profitability in the competitive Hong Kong property market.
