We share Chow Penn Nee's and the Business Times' disappointment with Lee Hsien Yang's absence at the earnings briefing of Fraser & Neave Tuesday night. Given all the corporate issues at this company – such as the sudden departure of CEO Dr Han Cheng Fong, and the apparent dissing of takeover suitor Heineken – it would certainly have been a good idea for Mr Lee to be present to field questions and shed some light on these issues.

The attention F&N has received in the last month has not been positive. Lingering questions remain about why the respected Dr Han left so suddenly. The company certainly made numerous disclosures about his departure, but they added up only to explain why he did notleave, not why he did leave. The company was at pains to say it was not due to personality conflicts, after the arrival of former SingTel chief Lee as Chairman was speculated as one possible reason. We have previously commented on the absence of an explanation which fully satisfies us.

Then there was the issue of a possible takeover by Heineken, which the company successfully defended (although, as we said previously, we don't really know why averting creating shareholder value through being taken over could necessarily be deemed a positive). Perhaps Dr Han supported considering a bid from Heineken when the other Directors did not.

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The company has argued it has satisfied continuous disclosure obligations. As for why Lee Hsien Yang was not present at Tuesday's press briefing, the Business Times reports:

It was a news conference many journalists were looking forward to. They expected Lee Hsien Yang to face the media for the first time as Fraser & Neave's chairman at the group's full-year financial results announcement yesterday.

But Mr Lee was a no-show, and director and group company secretary Anthony Cheong fielded the questions.

Mr Lee was not required to attend the news conference, Mr Cheong said. 'Mr Lee is a non-executive chairman, so he need not be here.'

That may be so if this was a "routine" earnings announcement. But given all that has transpired within the last month we are incredulous that Mr Lee – so open while at SingTel, winning awards for transparency – did not use the opportunity to clear things up. Being quoted about the earnings in the press release hardly consoles us, given that those quotes were probably written by the Corporate Communications department anyway. We weren't at the briefing yesterday, but it sure would have been nice to get a more comprehensive explanation as to his absence. The lack of such an explanation opens the door to speculation that perhaps Mr Lee was told not to come. While Mr Anthony Cheong is probably very well qualified to field questions at the press briefing, given that he is a director of the company, it is rather unusual for a Company Secretary to lead such a briefing. Not least, because the company is still without a CEO. It would have been natural for the Chairman to step in. He may be non-executive, but he is also a consultant to the firm.

While leads us onto the next issue. Conrad Raj should certainly have contacted F&N for comment about his piece F&N's CEO hunt halted as Hsien Yang rethinks strategy on November 12, which F&N obviously took great exception to. We don't know whether he did contact the company or not. We haven't asked him, and so we only have F&N's tersely worded rebuttal to go on. But given the company's combative stance towards the media over the last month it's perhaps no surprise that it hasn't won many friends in the media.

We maintain our view that not just following the letter of continuous disclosure obligations, but being seen to be doing everything it can, would have been much better to rebuild trust with investors.

Mark Laudi


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Labels: Anthony Cheong, Fraser, Han Cheng Fong, Lee Hsien Yang, Neave