Swire Properties is a listed company on the Hong Kong stock market. Although Lin Huowang is the controlling shareholder, as the chairman of the board of directors, he has the decision-making power and daily operational rights over the operation of the entire group company.
However, the existence of the board of directors is also a form of supervision and restraint on him. The most important thing is to prevent major shareholders like him from transferring interests and digging up the company's core assets.
However, Lin Huowang was quite resentful of this board of directors. After all, when Jardine Matheson controlled the Hong Kong Land Group, it had taken away countless core interests of the Hong Kong Land Group and transferred them to the Jardine Matheson headquarters. After receiving the benefits, these directors dared not say a word.
Now I have only spent 10 million Hong Kong dollars on advertising, but everyone with an overflowing sense of justice comes to question me. It's ridiculous.
As soon as Lin Huowang finished speaking, Huo Zhenting could no longer hold back and suddenly stood up, saying in a loud and aggressive voice:
"Chairman Kobayashi! All directors!"
As he spoke, he picked up a thick stack of documents and slammed them on the table. A crisp "pa" sound broke the silence of the meeting room. "Regarding the so-called 'annual advertising sponsorship contract' signed by Dairy Farm and Asia Television, I believe there are extremely serious problems!
The core of the problem is that this huge expenditure of 10 million Hong Kong dollars seriously violates business common sense and corporate governance principles, and is suspected of using the position of a major shareholder and the authority of the chairman of the board of directors to conduct obvious related transactions that damage the interests of the Hong Kong Land Group and all shareholders!
First, the value is seriously mismatched! According to market data we have, over the past two years, the TVB Miss Hong Kong Pageant, Hong Kong's highest-rated and most influential television program, has only generated around HK$15 million in advertising sponsorship revenue throughout its entire competition.
This was the result of a joint contribution from over a dozen top brands! The highest single sponsorship fee was a mere HK$2.3 million!
I'd like to ask, what merits does Asia Television have? How can a platform that recently took over, whose predecessor, ATV, was on the verge of bankruptcy and currently ranks last in the ratings among the three major TV networks, secure a single sponsorship worth nearly four times as much as TVB's top program? Is this justified? Where is its market value?
Secondly, the historical data comparison is stark! Please see, this is ATV's advertising revenue record for the past three years. Even at its peak, before its closure and acquisition, the value of a single advertising contract never exceeded HK$1 million!
Moreover, the sponsor of that one million is none other than the Lin Group under your name, Mr. Kobayashi!
Isn't this just a replica of a related-party transaction? Only the amount is magnified tenfold! And the nature is even more egregious!
Third, the process is questionable and the decision was made hastily! As far as I know, the time from the proposal to the signing of the contract for this 10 million yuan sponsorship was extremely short, and it did not undergo sufficient review and risk assessment by the Dairy Farm Board and the relevant committees under the Hong Kong Land Group Board.
This is entirely the result of your personal will, Chairman Kobayashi! Does this comply with the company's articles of association and the board meeting procedures?
Fok Chun-ting became increasingly agitated as he spoke, his finger almost pointing at Lam Ho-wang, his voice filled with strong accusations: "In summary, we have every reason to question whether this HK$10 million advertising sponsorship is a normal business practice at all!
Instead, you, Mr. Kobayashi, used your control over the Hong Kong Land Group to blatantly transfer the interests of all shareholders through the Dairy Farm channel to Asia Television, which you personally fully control!
This is a blatant profiteering, a violation of corporate governance principles, and a serious infringement on the rights and interests of all shareholders!
He finally made a resounding request: "Therefore, I move that the board of directors should immediately ask Mr. Chairman, Mr. Kobayashi Tenmo, to cancel the sponsorship contract between Dairy Farm and Asia Television!
And use all legal means to recover all the money paid to Asia Television!
If the funds cannot be recovered, Mr. Kobayashi Tenmoku will have to bear the loss personally! At the same time, the board of directors should conduct an in-depth investigation into the incident and clarify responsibilities!
Ho Chun-ting's words were detailed, appropriate and very aggressive, instantly igniting the conference room.
As soon as he finished speaking, the British directors who had already arranged to join forces immediately stood up to show their support.
"I fully agree with Director Huo's opinion!"
A director representing a British consortium said in a deep voice, his voice filled with his usual arrogance, "This deal is completely inexplicable from a business logic perspective. Asia Television's current audience share and influence simply don't have the platform foundation to support advertising worth 10 million."
This seriously violates the principle of return on commercial investment. We strongly doubt the purity of their motives and demand an immediate halt and accountability!
"As a member of the audit committee, I am deeply concerned about this massive related-party transaction that bypasses normal decision-making procedures."
Another director pushed his glasses up, his tone seemingly professional and calm, but in fact every word was sharp, "This undermines the corporate governance system and internal control mechanism that Hongkong Land Group is proud of.
We must thoroughly investigate every step of the contract signing process to ensure that there is no abuse of power or damage to the company's interests.
Otherwise, the reputation of Hong Kong Land Group will be irreparably damaged. How will international investors view us? How can the stability of our share price be guaranteed?
He directly raised the issue to the level of the company's credibility and stock price stability.
"We invested in Hong Kong Land because we valued its stable operations and transparent management."
Another director chimed in, his tone pressing, "This transaction is fraught with opaque and uncontrollable risks. Mr. Chairman, you must provide an explanation that will convince all shareholders. Otherwise, it will be difficult for us to continue to support the current board structure and management decisions."
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