Jardine Matheson’s Charmed Life Challenges China Wisdom
The old colonial hong remains a quiet but prosperous presence in Hong Kong even though it’s now incorporated in Bermuda. Its secret? Allowing its interests to stray far from the mainland.
It’s been a good week for Jardine Matheson Holdings Ltd. Shares of the Hong Kong-based, Singapore-traded conglomerate set off on their biggest two-day gain since the 2008 financial crisis on Monday after the company announced a $5.5 billion buyout of its second-largest unit. On Thursday, the Jardines flagship reported a profit and maintained its dividend after a year of what it called “major challenges.” The 189-year-old group is surviving the pandemic and political change in Hong Kong in better shape than two fellow businesses with historic British roots, Swire Pacific Ltd. and HSBC Holdings Plc.
If that isn’t a surprise, perhaps it should be. Jardines is intimately associated with the establishment of Hong Kong as a colony, having been founded in Guangzhou in 1832 to trade opium, among other products, and playing a key role in events that led to China ceding the territory to Britain a decade later. When the group delisted from Hong Kong’s stock exchange ahead of the 1997 handover, China condemned the decision as “very irresponsible.” Analysts told Bloomberg News at the time that the move was a logical result of Jardines’ poor relations with China. The group had already moved its place of incorporation to Bermuda from Hong Kong in 1984, the year that Margaret Thatcher signed the Joint Declaration on the territory’s return.