MTR Hires New York Transport Boss Walder as Chief Executive in Hong Kong
Walder, 52, will join MTR as CEO-designate on Nov. 1 and head the company on Jan. 1, according to a Hong Kong stock exchange filing today. MTR, 76.7 percent owned by the government, will pay him HK$7.2 million ($924,000) a year, an undisclosed discretionary bonus and interest in shares.
Walder will take charge of a company that’s building new lines at home and expanding overseas, and running subways and commuter railways in China, the U.K., Australia and Sweden. MTR, which also gets revenue from sales of apartments above its stations, have seen its earnings boosted by the more than 70 percent surge in Hong Kong home prices since the start of 2009.
“Much of the company’s business plan in the near future has been in place for a while,” said Jonas Kan, a Hong Kong- based analyst at Daiwa Securities Capital Markets. “The hiring of a new CEO is unlikely to change that. It’ll be a while before we can assess what impact he can bring to the company.”
As MTA’s chief executive officer, Walder slashed 3,500 jobs and curbed overtime pay over 18 months to cut costs by $525 million
The MTR began a search for a new leader after chief executive officer Chow Chung-Kong, 60, said in December he will retire at the end of 2011. MTR has risen about 150 percent since Chow took over in December 2003, against a 78 percent increase in the benchmark Hang Seng Index.
The stock rose 0.8 percent to HK$26.85 as of 9:34 a.m. local time in Hong Kong. Walder was appointed as chief executive officer for 30 months.
During Chow’s tenure, the company merged with a Hong Kong railway operator and started work on a HK$66.9 billion line connecting the city to China’s high-speed-rail network.
MTR’s full-year underlying profit, which excludes property valuation gains or losses, climbed 19 percent to HK$8.7 billion, the company said in March.
Sales were boosted by the properties it owns around its stations. MTR is one of the biggest owners of the city’s unoccupied residential sites.
Walder, who grew up in the Rockaways section of Queens, worked for the MTA for 12 years starting in 1983. He was executive director and chief financial officer from 1993 to 1995 before leaving to head London’s transit system, where he was credited with spearheading its largest investment since World War II. He returned to the MTA in 2009.
The MTA said Walder’s efficiency measures will yield $3.8 billion in cumulative savings by 2014. In a July 20 report on the five-year capital program, Walder announced more cuts and changes that will generate $4 billion in savings.
“He set a new course for the MTA during an extremely difficult period when the agency was not given the resources required to meet the city’s needs,” New York Mayor Michael Bloomberg said in a statement.
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