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The Honolulu Advertiser
Posted on: Wednesday, March 26, 2008

Ranch's fate determined by billionaire

 •  Molokai Ranch closure leaves bleak prospects

By Rick Daysog
Advertiser Staff Writer


Based: Singapore

Chairman: Quek Leng Chan

Assets: $2 billion

Annual revenue: $422.6 million

Employees: 1,841

Holdings: Hotel, gaming, property development and oil and gas investments

Quotation: "The aforementioned cessation of operations of MPL (Molokai Properties Ltd.) is not expected to have any significant financial impact on GL Group for the financial year ending June 30, 2008," GL Group company secretary Linda Hoon said in a news release.

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The ultimate decision to shut down Molokai Ranch and lay off more than 120 workers rested with a billionaire investor, who's listed as one of the richest men in Malaysia.

With a net worth of about $2.9 billion, Quek Leng Chan oversees a vast financial empire that includes oil and gas ventures in Australia, bank holdings in China, gaming interests in England and Molokai Ranch.

"He comes from a billionaire family that's been doing business for decades," said Moloka'i hunter and Hawaiian homesteader Walter Ritte Jr., a longtime opponent of Molokai Ranch's expansion plans.

"We have a hard time understanding what makes them tick, and we don't think they understand what makes us tick."

The 64-year-old Quek became executive chairman of Molokai Ranch's Singapore-based owner GuocoLeisure Ltd. in May 2007 and quickly shook up the sleepy resort development company.

He replaced senior managers, wrote down underperforming assets and changed the corporation's name from Brierley Investments Ltd., shedding the company's ties with its founder, New Zealand corporate raider Ron Brierley.

Molokai Ranch officials did not return calls yesterday but in a news release the company described its decision to "mothball" the 64,000-acre ranch as "purely a business one."


GuocoLeisure, whose predecessor Brierley paid about $50 million to purchase the ranch in 1990, previously reported that it suffered about $40 million in operating losses during the past seven years.

Costly delays and community opposition to the ranch's controversial plan to develop 200 luxury lots at La'au Point made it impossible to bear the continued losses, Molokai Ranch said in its release.

Founded in New Zealand in 1961 as BIL International, GuocoLeisure initially was known as an investor vehicle for Brierley, the corporate raider. During its late 1980s heyday, the company owned stakes in more than 300 companies worldwide.

But the Asia economic crisis of the late 1990s forced GuocoLeisure to retrench, leading to the sell-off of much of its holdings. Shortly after the retirement of Ron Brierley in 2001, Quek became the company's chairman, and last year he assumed the title of executive chairman.

The closure of Molokai Ranch comes as Quek's companies have been under some financial pressure recently.

Quek, who recently was listed by Forbes magazine as the world's 314th wealthiest person and the fifth richest man in Malaysia, is chairman and CEO of GuocoLeisure's parent Guoco Group.

Guoco Group said in a recent report that its earnings for the six months ending Dec. 31, 2007, fell 36 percent to $132.5 million.

Meanwhile, GuocoLeisure has seen its stock price fall by as much as 50 percent during the past year.

"It just looks like they couldn't see any way to make money out of it so they decided to close it," said Robert Hastings, president of the local real estate appraisal and consulting firm of Hastings, Conboy, Braig & Associates Ltd.

Reach Rick Daysog at rdaysog@honoluluadvertiser.com.