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Business

Hong Kong tycoon Li in war of nerves with Chinese media

Li Ka-shing released Tuesday a comment to counter allegations about his speculated withdrawal from China.

The notion that Li Ka-shing and his business empire might abandon China is creating a good deal of tension between one of Hong Kong's richest men and the government-controlled Chinese media.

     These moves by Li to reorganize his business interests have been going on for years. He has divested some of his assets, including real estate on the mainland, and has been shifting more investments abroad, such as to Europe. His most recent actions, however, have come at a crucial moment for the Chinese economy. 

     On Sept. 8, Cheung Kong Infrastructure Holdings, a Li group company, announced a proposed merger with Power Assets Holdings, a sister infrastructure company. The new company's registered head office is to be in Bermuda. When this relocation is complete, there will be no more listed company in Li's group based in Hong Kong.

     This merger news has triggered blistering attacks on Li in the Chinese media. On Sept. 12, an expert at Xinhua News Agency's Outlook Think Tank helped fan the flames against Li by posting the comment: "Don't let Li Ka-shing run away."

     The People's Daily also denounced Li, urging readers to further proceed with reforms more earnestly so that Li would lose big and eventually regret his withdrawal from China. It was one of the rare moments that an official mouthpiece of the Chinese Communist Party has criticized Li's management strategy.

     Li's response to all this came Tuesday night when he issued a long statement on his flagship Cheung Kong Hutchison Holdings website. In the statement, he flatly dismissed the allegations as "completely unfounded," denying a rumored rift with Chinese President Xi Jinping.

    "Their logic was absolutely thwarted and the language used was quite negative," Li wrote.

Costly moves

Li is 87 years old. His business empire began with the manufacture of high-quality, low-priced plastic flowers. He is affectionately nicknamed "Superman" -- both in Hong Kong and on the mainland.

     His wealth is vast. According to Forbes magazine, he is estimated to be worth roughly $24 billion. He is also famous for his investment prowess. When Hong Kong property values once nosedived, he made sure to snap up real estate at rock-bottom prices.

     The Chinese media's slamming of Li is probably because of concern that his recent moves could accelerate a capital exodus triggered by increased distrust of investors at home and abroad in the slowing Chinese economy.

     One of Li's edges in business has been his close ties with past top officials of the Chinese Communist Party, including the late paramount leader Deng Xiaoping and former President Jiang Zemin. However, it is believed that he is not so close with President Xi.

     In response to all this criticism, Li warned against the media and the ease with which they place blame on one individual -- namely, him.

     "I trust that Cultural Revolution style of accusations will not make a comeback," he said.

(Nikkei)

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