From the Far Eastern Economic Review

In a region dominated by family-owned companies, the Henderson Group of companies is more family-centric than most. No less than 10 relatives of founder Lee Shau-kee hold senior positions in the group, while the family's 65% stake in flagship Henderson Land ensures the company is immune from takeover bids and minority-shareholder activism.

The close-knit nature of the group is no surprise because Henderson has long been intimately entwined with the fate of the Lee family itself. In 1948, with communist troops moving rapidly into southern China, a currency trader and gold dealer in Guangzhou named Lee Kai-po dispatched his two surviving sons to Macau and Hong Kong with most of the family assets. The move proved prescient as the elder Lee was persecuted as a capitalist throughout the 1950s and 1960s, losing his remaining assets.

The son sent to Hong Kong, Lee Shau-kee, proved to be the family saviour. After working for a foreign-exchange dealer, Lee struck out into the real-estate business with two partners in 1956. The company they founded, Sun Hung Kai Properties, went on to become a local property giant. In 1973, Lee split from his partners to found Henderson Development, which has remained the holding company for the family companies. Henderson Land was initially the property manager and sales agent for Henderson Development.

The establishment of a family company had the ironic result of bringing about Lee Shau-kee's divorce from his wife of 15 years, Lau Wai-kuen. She had remained in the background while Lee ran a business with others, but joined Henderson when it was founded.

Lee's official biographer, Leung Fung-yee, portrays Lau as an aggressive Dragon Lady trying to overstep her authority and abilities. But other accounts speak of simple differences of opinion on management issues. Whatever the cause, the pair divorced in 1981, though Lee still moved his entire extended family into a new Henderson development in Hong Kong island's Mid-Levels district, Eva Court, named after her.

The divorce seems to have made Lee more determined than ever to protect the Henderson group from the clutches of wily outsiders. "I will not marry again because I'm afraid any woman would only see my money," he told biographer Leung. Added daughter Margaret: "We're not opposed to our father having an active social life, but he prefers to be with the family, eating dinner and playing with the grandchildren."

Since then, the lock-grip has not weakened. Henderson Land, listed in 1981, remains 65% owned by Lee family members. The company's nonproperty investment arm, Henderson Investment, founded in 1988, is now 73% family-owned. Lee has also drawn family members into senior positions inside the group. A sister and a brother have been directors of Henderson Land since the mid-1970s, while Lee's two sons, Peter and Martin, are the high-profile successors.

In addition, daughter Margaret is head of marketing for Henderson Land while her husband Li Ning is an executive director of Henderson Land and Henderson Investment. Second daughter Elizabeth was in the accounting department of Henderson Land at last report. Company sources say that a niece, Violet, is the chief business strategist of Henderson Cyber, having previously looked after family business interests in the United States.

Douglas Moore, the group's chief strategist, says the Lee family influence is not a great as it appears, attributing only "high-level strategies" to Lee Shau-kee. "I report directly to {Henderson Land Vice-Chairman} Colin Lam. It's a normal, professional, systematic company in that respect," he says.

But analysts familiar with the company say that Lam is "virtually family," having been recruited by Lee in 1982 and being the only outsider with stakes in the family's private holding companies. "One way to look at Henderson," says one analyst, "is like a giant make-work project for the Lee family."

Lee Shau-kee clearly wants to keep it that way. In recent years, the family stakes in Henderson Investment, Hong Kong and China Gas and Miramar Hotel have all been raised by between 5% and 10% in moves analysts attribute to preparations for the handover of the group to his sons.

A more symbolic indication of Lee's plans to ensure an enduring legacy is the massive four-storey family mausoleum, topped by a bejewelled watchtower and occupying almost half a hectare of land, which he built in his ancestral village of Daliang in the Pearl River Delta on the death of his mother in 1996. Lee's father, who died aged 106 earlier this year, is also entombed in the vault.

Lee has been the embodiment of the filial son. The care of the 60 members of the extended family will soon be in his sons' hands. Preserving its wealth for future generations will be a mighty task.

Henderson Land, listed in 1981, remains 65% owned by Lee family members