Today, on November 14th, Hurun Research Institute released the “2023 Red Beauty Summit · Hurun Women Entrepreneurs List.” Benefiting from the rise in the Hong Kong dollar exchange rate and company dividends, 94-year-old Kuang Xiaoqing became China’s richest woman for the first time with a wealth of 72 billion yuan, rightfully earning the title of the “wealthiest elderly lady in China.”
Many may not have heard the name “Kuang Xiaoqing,” but they have likely heard of New World Development. As the wife of the founder of New World Development, Kuang Desheng, and the current largest shareholder, Kuang Xiaoqing holds the highest decision-making power.
In fact, the significance of Kuang Xiaoqing, the widow of the founder, to New World Development lies in the palace-like struggles her three sons ignited over a decade ago, a sensational event reported by Xinmin Weekly in 2012.
At the age of 94, becoming China’s richest woman, Kuang Xiaoqing may be experiencing a mix of emotions…
1
According to the report from Yangcheng Evening News, Kuang Xiaoqing was born in 1929 in Huacheng Village, Huashan Town, Guangzhou. She was the eldest daughter of the family. At that time, the Kuang family operated dyeing workshops, owned abundant fertile land, and lived in prosperity. When she was 7, her father, who was doing business in Vietnam, unexpectedly passed away, and Kuang Xiaoqing assisted her mother in household chores. Later, she went to Guangzhou to study with her uncle.
In 1949, at the arrangement of her family, 20-year-old Kuang Xiaoqing married Guo Desheng, who was 18 years her senior and operated a grocery store called “Hung Cheung Hop Kee” in Hong Kong. After 1950, Guo Desheng, with the agency rights for nylon products, entered the ranks of Hong Kong’s multi-millionaires. After 1960, Guo Desheng, Li Ka-shing, and Fung King-hei joined forces to enter the real estate industry. With the model of “layered sales, ten-year installment payment,” they firmly established themselves in the real estate industry, and the Guo family thereby became one of the four major families in Hong Kong.
2
Founded by Guo Desheng in 1972, New World Development has the four characters “Hung Kei Yong Gu” (Hung Kei Eternal) engraved on the company’s exterior wall.
Back then, to prevent disputes over inheritance and family separation, Guo Desheng placed the equity of the Guo family’s New World Development into a trust fund. The beneficiaries of the fund included his wife Kuang Xiaoqing and their three sons: Guo Bingxiang, Guo Bingjiang, and Guo Binglian.
In October 1990, Guo Desheng passed away, and New World Development, with Guo Bingxiang as the Chairman and CEO, managed all the affairs of the group. Guo Bingjiang and Guo Binglian, the two younger brothers, assisted in handling real estate business and administrative and technological development, respectively. Although it was a division of responsibilities, the eldest brother, Guo Bingxiang, held significant power.
Between 1990 and 2008, the story of the Guo brothers, “brotherly cooperation and shared benefits,” was a popular tale in the Hong Kong real estate industry, recognized as one of the most stable and successful family enterprises. While the three brothers expanded the core business of New World Development, they also diversified the company’s operations into areas such as communications, transportation, the internet, and infrastructure, extending the market of New World Development from Hong Kong to mainland China and overseas.
However, in May 2008, the board of directors of New World Development removed Guo Bingxiang from the positions of Chairman and CEO, appointing him as a non-executive director, and the mother, Kuang Xiaoqing, became the Chairman. The CEO position was shared by the two younger brothers, Guo Bingjiang and Guo Binglian. Originally, Guo Bingxiang and his longtime “confidante” Tang Jinxin, with whom he had conducted transactions worth billions of Hong Kong dollars in the real estate industry, raised concerns among other family members about whether Guo Bingxiang’s decisions were rational.
As a result, the two younger brothers appointed an American doctor to diagnose their elder brother with “manic-depressive disorder,” possibly a consequence of the kidnapping he endured in 1997. Guo Bingxiang, nicknamed “tycoon,” was kidnapped by the notorious criminal Cheung Tze-keung in 1997. He was beaten, stripped naked, and confined in a wooden box with air holes. A week later, his family paid 600 million Hong Kong dollars in ransom to secure his release.
After May 2008, Guo Bingxiang held only the title of “non-executive director” at New World Development. He remained active in the business world and re-registered the company under the name of New World Development. However, his mother did not approve of this move, and Guo Bingxiang had to change the company’s name. What truly signaled to the outside world that Guo Bingxiang had no chance of a comeback was the restructuring of the family trust in 2010.
In October 2010, the Guo family trust fund was restructured, with Guo Bingxiang’s name disappearing, leaving only the interests of his family members. Public opinion believed that this restructuring was to prevent Guo Bingxiang from selling equity in a fit of pique, leading to the loss of family business control.
In August 2011, after three years of internal strife, Guo Bingjiang and Guo Binglian were promoted from vice chairmen of the board to co-chairmen, and Kuang Xiaoqing stepped down from the board of directors.
However, on March 29, 2012, Guo Bingjiang and Guo Binglian, co-chairmen of New World Development, were investigated by the Hong Kong Independent Commission Against Corruption for alleged bribery. Speculation arose that this was the result of the eldest brother, Guo Bingxiang, denouncing them. This investigation by the Independent Commission Against Corruption was related to bribery cases involving New World Development, all linked to Hui Suk-ching. Hui Suk-ching, from a prestigious background, was a well-known figure in Hong Kong’s political and economic circles. In 1997, he served as the first Financial Secretary of the Hong Kong Special Administrative Region and left the civil service in June 2000. He then served as the Executive Director of the Mandatory Provident Fund Schemes Authority for three years before rejoining the civil service in 2005 as the Secretary for Administration of the Hong Kong government. After being abandoned by the family, Guo Bingxiang twice reported that his two younger brothers had engaged in “conflict of interest” with Hui Suk-ching.
Ironically, on the evening of May 4, 2012, Guo Bingxiang was invited by the Independent Commission Against Corruption for a “coffee session” on suspicion of violating the Prevention of Bribery Ordinance.
On December 22, 2014, the sentencing of the “century corruption case” involving the Guo brothers took place in Hong Kong. Guo Bingjiang, co-chairman of New World Development, was convicted and subsequently resigned from his position in New World Development.
In 2018, the eldest son, Guo Bingxiang, passed away suddenly. Kuang Xiaoqing, with white hair sending off the black-haired, still showed strong determination amidst grief. She divided half of Guo Bingxiang’s 60 billion yuan assets to her daughter-in-law. With the assets left by the eldest son and the ownership of New World Development, Kuang Xiaoqing has since maintained her position as the richest woman in Hong Kong.
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Among the four major families in Hong Kong, the Guo family is the only one that did not diversify its development.
Since 1970, Guo Desheng had been investing the money earned from real estate into buying land, building houses, and collecting rent. Over the decades, New World Development has accumulated 22 shopping malls and 6 super-grade office buildings in Hong Kong and mainland China. The land reserve area in hand exceeds 10 million square meters, with only 15% developed.
These properties bring considerable income to New World Development through rent alone. In the fiscal year 2022, the net rental income of New World Development was 24.8 billion Hong Kong dollars.
According to the announcement made by New World Development in 2018, the major shareholder, Kuang Xiaoqing, increased her holdings by 140,000 shares, bringing her ownership to 26.36%. Calculated in this way, based on the rental income alone in 2022, she received more than 6 billion Hong Kong dollars, truly earning the title of the “strongest landlady.”
Now, the management of New World Development has transitioned to the hands of the third generation of the family. Although Kuang Xiaoqing, in her nineties, has long retired, whenever there are changes in the company, her involvement is still needed to oversee the overall situation…