By his mid-twenties, Ben Keswick was being groomed to run the enterprise his household has led for 5 generations in Hong Kong and was a $50bn pan-Asian empire.
This week, aged 48 and fewer than two years into his function as taipan — or prime boss — of Jardine Matheson, Keswick has pulled off one of the biggest corporate restructurings within the firm’s historical past.
The deal, through which the Jardines group will purchase out the shareholders of its second-largest enterprise unit for $5.5bn, may add huge sums to the Keswicks’ multibillion-dollar fortune and that of two different households linked by marriage, the Weatheralls and the Jencks.
But it additionally presents dangers for the 190-year-old enterprise. Keswick will unwind a convoluted cross-holding construction devised by his uncle, Sir Henry Keswick, within the Nineteen Eighties to defend it from the specter of a hostile takeover. The set-up allowed the descendants of the group’s founding household to regulate an enormous conglomerate whereas holding solely about 17 per cent of the inventory.
Keswick is attempting to “modernise the enterprise at an pressing tempo” stated one confidante, an adviser to Jardines’ board.
Nonetheless, “it creates a extra typical set of dangers”, the individual added, “the biggest being what occurs in the event that they don’t ship the numbers in two or three years”.
A canny deal for Jardines
Jardine Matheson’s dominance is felt all through Hong Kong. Its sprawling belongings within the metropolis embrace a few of Hong Kong’s costliest business properties and its largest manufacturers, such because the Mandarin Oriental lodge. Elsewhere, its holdings vary from Vietnam’s largest dairy producer to a small cement maker in Thailand.
However its huge portfolio has attracted criticism. Jardines is “in round 28 completely uncorrelated sectors acquired by Henry [Keswick] over the 47 years he was on the prime of the agency, and it’s actually onerous for anybody to articulate why”, stated one adviser to the enterprise. “Below Ben, you’ll begin to see them handle their portfolio with a sharper deal with sectors and return on capital.”
The Keswicks have managed the group for 5 generations since Thomas Keswick, from Dumfriesshire in Scotland, married the niece of Scottish dealer William Jardine, who had began a service provider enterprise in Hong Kong to commerce tea and opium.
However conserving the household on the helm has required some politically unpopular strikes. Jardines angered Beijing within the mid-Nineteen Nineties when Henry Keswick relocated its Hong Kong inventory market itemizing to Singapore amid considerations in regards to the territory after its handover to China in 1997.
Keswick inherited the chairmanship from his uncle, Henry, who retired aged 80. “Ben is a consensus chief the place Henry was a conviction chief,” stated one individual near the enterprise.
Henry — who has been described by the FT as a “tall, round-faced Outdated Etonian with a courtly air and a mischievous sense of humour” — didn’t have any youngsters, leading to a succession battle that pitted Ben towards his cousin, Adam, a board director of Jardines.
“I’m positive Adam was upset however I haven’t seen any issues between the 2,” stated an govt who advises the board. “They’ve an excellent working relationship and collectively have masterminded the restructuring.”
The overhaul has to this point been considered positively by the market. Shares within the group rose 15 per cent after the announcement and have continued to climb.
“It was actually a great deal for Jardine Matheson,” stated Hugh Younger, Asia head of Aberdeen Customary, whose stake in Jardine Strategic shall be purchased out at $33 a share. “It was arguably price much more”.
Tips on how to future proof a conglomerate
Keswick is considered by allies and individuals who know him as each “vivid” and “paranoid”.
“He has a powerful sense of responsibility to the corporate but in addition is aware of their historical past can’t outline it,” stated one ally.
In frequent along with his uncle, stated buddies, Keswick has not made a taboo of the corporate’s function within the Sino-British opium wars. Each have approached constructing a relationship with China — which is essential to Jardines’ future in Hong Kong — by being upfront about their household’s previous.
“We now have had lengthy discussions about Jardines’ historical past within the opium commerce,” stated the chairman of a significant monetary providers agency who has labored with the group for some years. “[Ben] doesn’t take himself too critically in these discussions.”
Keswick, who lives in Hong Kong along with his spouse, Martha, and 4 youngsters, is “intensely personal”, based on one buddy. He has by no means given a media interview.
Now, his largest problem is future-proofing Jardine after a big hit to its property and lodge portfolio through the pandemic and following two years of political crisis in Hong Kong, the place it makes greater than a 3rd of revenues.
He has made a variety of decisive moves since taking on in 2019. Amongst them was appointing a “recent blood” board that features Stuart Gulliver, the previous chief govt of HSBC, and Anne O’Riordan, ex-head of life sciences at Accenture, who has been tasked with overhauling the digital technique of Jardines and its portfolio corporations. Beforehand, its board was dominated by former executives of the corporate and relations.
Keswick has additionally created Jardine’s first funding committee, quashing a cultural hangover from his uncle’s tenure that meant the chairman had remaining management of all funding choices. This week, he additionally introduced a strategic funding partnership with Chinese language personal fairness agency Hillhouse Capital.
In a 2016 article in Jardines’ firm journal, Thistle, he wrote about his ambitions for bringing the enterprise into the twenty first century. “As soon as we now have taken that first step, there is no such thing as a wanting again . . . We simply have to face the longer term and provides it a go.”
5 years on, the way forward for considered one of Hong Kong’s oldest enterprise empires is squarely in his arms.