Tiddlywinks  And  Champagne 

Mr Eric Hotung telephoned me, one hot summer’s day, and asked me to visit him at his luxury, private office at Cosmopolitan Building in Stanley Street, Central, almost next door to the famous and historic Luk Yu Teahouse. 

Drinking champagne from a crystal glass, he spoke of his annoyance at what had happened to his beloved stock market. 

He asked nothing from me and I was perplexed at his having telephoned me.  

Then, he said, matter of factly: ‘You do know how to play, tiddlywinks, don’t you?’ 

(Tiddlywinks is a young child’s game in which players try to flip plastic counters into a cup by pressing them on the side with a larger counter)  

I replied that I had, indeed, played the game when I was very young in school in England. 

‘Let’s have a game, then?’ he suggested, refilling his champagne glass. 

With that, we played the child’s game of flicking tiddles from one cup to another.  

It was a silly thing to do, no doubt, but it permitted me to understand, to some extent, how this eccentric businessman thought. 

During the next hour or so, he told me that I, really, should be more understanding about the situation in respect of the war between the stock exchanges. 

He said:  

There, really, was no reason for there to have been 3 stock markets. If the investors of Hongkong deemed it necessary to have more time to invest, then, The Hongkong Stock Exchange could just stay open longer, Monday to Friday. Even night trading, if necessary. (Your tiddle, I believe).

 

‘I used to have a lot of business on my seat, buying and selling stocks for my clients. Now, business has dropped to almost nothing. (Good shot!) I am thinking of packing it in.’ 

While the game of tiddlywinks progressed, with Mr Eric Hotung, clearly, beating me roundly, in walked a Mr Eric Machado, his Personal Assistant, without so much as a how-de-do. 

Mr Eric Hotung barked at him: ‘Get out! Can’t you see that I’m busy?’ 

Mr Eric Machado made a hurried exit. 

I met Mr Eric Hotung on a number of times after that encounter, but I never played  tiddlywinks with him again. I, also, made it a promise to myself to keep a safe distance from this businessman because it was only too apparent that this fat little man had a propensity for irrational behaviour as had been made only too obvious by the fact that he hired and fired managing directors of Cosmopolitan Properties and Securities Ltd, sometimes on a semi-annual basis. 

I witnessed one of his many eccentricities when, at about 8 am on a Sunday morning, soon after the tiddlywinks encounter, he handed to his then managing director of Cosmopolitan Properties and Securities Ltd, a $HK100 bill and ordered him to go from Black’s Link, his, then, palatial residence, to The Mandarin Hotel in Central Hongkong, and there to purchase a Cuban cigar. 

When the Englishman explained that the cigar store would not be open at that time of the morning, Mr Eric Hotung ordered him to wait until it did open and, then, to return with his cigar, a receipt for the purchase … ‘and don’t forget my change.’ 

The idea behind this irrational behaviour was to embarrass this gentleman, denigrating him to the role of a servant of the Chairman instead of Managing Director of a well-heeled, publicly listed Company, and, hopefully, giving him the very clear message that it was time that he sign his letter of resignation – undated. 

I witnessed this incident when in the company of Mr David Chiu Tat Cheong, the Managing Director of Far East Consortium Ltd, also, a publicly listed company, when Mr David Chiu Tat Cheong had asked me to accompany him to Mr Eric Hotung’s house in order to try to persuade Mr Eric Hotung to sell the controlling interest in his company to Far East Consortium Ltd. 

The approach was roundly rebuffed, but I learned a great deal, both of Mr David Chiu Tat Cheong and Mr Eric Hotung. 

Mr Noel Croucher was another eccentric character of those days. 

Mr Noel Croucher was the Chairman of China Provident Company Ltd, a listed company of The Hongkong Stock Exchange, also.  

He, too, operated a seat on The Hongkong Stock Exchange. 

I interviewed him at his office in Central and we talked of his art collection, his dirty shirts, the lack of being able to find a good housekeeper, and, of course, that accursed man, Mr Ronald Li Fook Shiu. 

I recall how this gaunt and obviously unhealthy ageing businessman lamented: 

‘I can’t understand the nerve of that man (in reference to Mr Ronald Li Fook Shiu). I really can’t! If he had come to me, I would have made certain that he got a seat on the exchange (The Hongkong Stock Exchange). I know all of the members and I am a friend of Dougie Clague (later knighted as Sir Douglas Clague, the man who founded Hutchison International Ltd). It was handled poorly. Major Newman! Ho! Still, that’s it, I suppose.

 

‘Do you like art? I have a fine collection of Ching Dynasty art, all painted by Italian priests who went to Beijing in the late 19th Century, you know.’ 

Around the perimeter of his small, private office, indeed there was a rich collection of Ching Dynasty paintings, numbering at least 50 oils. 

When I asked as to the reason that they were not hung on the walls, I was told that ‘I haven’t got around to it. Too busy, you know.’ 

The stock-market fever of 1971 was on the boil and The Kam Ngan Stock Exchange was fanning the flames of share trading, working interdependently with Far East Exchange, even to copying the same amendments to its bylaws and listing rules. 

Mr Woo Hon Fai’s friends took their businesses to him and asked for advice as to the quickest way ‘to go public’. 

It took very little time for Initial Public Offerings to be listed on The Kam Ngan Stock Exchange and Far East Exchange, simultaneously. 

The new listings came one after another, sometimes 10 new listings in a period of 5 business days. 

It became, what could be described as, the territory’s favourite pastime, second only to playing with the ladies of the night of Wanchai. 

Factory workers downed tools in favour of rushing up to the visitors’ galleries of The Kam Ngan Stock Exchange and/or Far East Exchange. 

Bus drivers found excuses not to go to work, school teachers telephoned schools, claiming to be ill, street sweepers found their way to China Building as did certain rank-and-file members of The Royal Hongkong Police Force and other, uniformed branches of the Hongkong Government. 

The normal business of Hongkong was starting to grind to a halt in favour of share trading. 

Messrs Woo Hon Fai and Ronald Li Fook Shiu continued to promote the national sport of the day. 

When Lee Hing Development Ltd went public on The Kam Ngan Stock Exchange, there was pandemonium. 

Lee Hing Development Ltd was Mr Woo Hon Fai’s company and was, essentially, a property investment company. 

Loyal to his friends, Mr Woo Hon Fai introduced Lee Hing Development Ltd to the investing public with the following important people, representing the Board of Directors: 

1.      Mr Ho Tim, an Executive Director of Hang Seng Bank Ltd;

2.      Mr Ronald Li Fook Shiu, Chairman of Far East Exchange;

3.      Mr Cheng Yu Tung, Managing Director of New World Development Company Ltd; and,

4.      Mr Young Chi Wan, the controlling shareholder of Miramar Hotel and Investment Company Ltd and the beneficial owner of King Fook Jewellery Company Ltd. 

The media was reminded, at the time of the listing of Lee Hing Development Ltd, that Mr Cheng Yu Tung, a very prominent Director of the company, was the person who had been responsible for the purchase of Holt’s Wharf in Tsimshatsui from John Swire and Sons Ltd (of London, England) for $HK130 million in the middle of the 1960s. 

Today, this site has been transformed into one of Hongkong’s largest shopping and hotel complexes in Tsimshatsui, facing The Peninsula Hotel: New World Centre. 

In those days, the company law of Hongkong was based on Great Britain’s Cohen Recommendations of 1948. 

This was a series of studies and recommendations on updating The Companies Act of Great Britain. 

The studies and recommendations had been started in 1923, but had been interrupted due to the outbreak of World War II – 1939 to 1945. 

Also, the, then, Hongkong Society of Accountants had not in place sufficient safeguards to control some of its more extravagant members. 

This situation lent itself, as far as the investment world was concerned, as Hongkong, being little more than a casino rather than a well-regulated, investment sphere of activity. 

For many companies and accounting firms, during this period in the history of Hongkong, the game was to find the best (and possibly legal) method to circumvent Chapter 32 of The Laws of Hongkong – The Companies Ordinance – and to be as creative as possible in the field of accounting. 

Mr Ronald Li Fook Shiu was a very able accountant and was a member in good standing of The Hongkong Society of Accountants. 

His son, Alfred, was studying law in university and, later, he helped to found the solicitors’ firm of Iu, Lai and Li, which operates in Hongkong to this day. 

Iu, Lai and Li earned a great deal of money by performing legal services for companies, desirous of pitching Initial Public Offerings on either The Kam Ngan Stock Exchange or Far East Exchange.