HONG KONG -- Subway operator MTR said on Tuesday its chief executive will retire early amid a series of construction scandals involving a rail link to Central, the city's financial district.
The company, one of East Asia's biggest listed rail operators, cited the impending departure of CEO Lincoln Leong Kwok-kuen in a statement submitted to the Hong Kong Stock Exchange.
The Sha Tin to Central rail link, a project costing 97.1 billion Hong Kong dollars ($12.3 billion), has been beset in recent months by problems including sinking pillars, substandard work and allegations of cover-ups.
MTR said in Tuesday's statement that inaccurate construction methodology for one of the train platforms had caused an overestimation of the number of couplers, which hold steel bars in place. The Hong Kong government -- MTR's largest shareholder -- found that the project blueprints for the Hung Hom station expansion submitted in July show 2,000 fewer couplers than in the previously approved plan.
"The board is very disappointed about such inaccuracies," the company said in the statement.
Leong, whose contract was to expire in 2020, told reporters he was accountable for such problems, as they occurred during his tenure. Leong joined the rail operator in 2002, and his early retirement will take effect once a replacement is found, the company said.
Philco Wong Nai-keung, projects director at MTR, also resigned on Tuesday, effective immediately, the company said.
MTR Chairman Frederick Ma Si-hang told reporters that he had twice submitted his resignation to the Hong Kong government, but that officials asked him to stay on until a new chief executive is found.
With a market capitalization topping $33 billion, according to QUICK FactSet, MTR trails two Japanese bullet train operators, Central Japan Railway and East Japan Railway, in valuation among East Asian railway companies.
The Hong Kong company operates beyond its territory, including metro and commuter train services in mainland China, Sweden, Australia and the U.K.
