HARLOW Butler, one of the world's largest money brokers, has fired its entire senior management team in Hong Kong, closed its regional head office and transferred the management and control of its regional operations back to London.
Top brass axed in the move include Wayne Lochner, chief executive (Asia-Pacific and Middle East), Roger Lawson, regional director, and Andrew Hills, a company director.
All three were sacked without notice at the beginning of the month and are understood to be in touch with lawyers over contractual difficulties stemming from the dismissals.
Harlow Butler's parent company, the British-listed MAI Group, said the cost of running the Hong Kong office could not be justified.
'It is fair to say that the costs were too high and it was not being run the way we wanted and that is the reason we closed it down,' a senior MAI director said.
The now-defunct regional headquarters occupied one third of Harlow Butler's offices on the 35th floor of Exchange Square, one of Hong Kong's most expensive business locations.
The office was responsible for the supervision of Harlow Butler's nine regional broking operations.
Frequent travel between these offices, as well as high rent, punishing accommodation costs and generous wages are understood to have contributed to the decision to close the office.
But money-broking sources in Hong Kong said the regional operation had increased net profits from about $12 million in 1993 to about $40 million this year and suggested ulterior motives lay behind the closure.
They believed the cutbacks were an attempt to keep worried shareholders at bay pending the announcement of a large media-related deal by the British company.
A London-based investment analyst pointed out MAI - which already owns the Meridien and Anglia television channels in Britain - is also bidding for the right to operate Channel Five, a national television station, and needed shareholders' support in its bid.
Investment analysts in London said a recent annual general meeting held by MAI was characterised by vocal shareholders questioning the high costs incurred by the Hong Kong regional head office.
'Shareholders were not satisfied with the 9.5 per cent profit growth revealed by MAI and highlighted costs coming out of the Asia-Pacific region as a cause for the disappointing performance,' said a British media analyst.
'The closure of the regional office in Hong Kong and the subsequent costs savings could be an attempt to mollify disgruntled shareholders prior to the Channel Five bid,' he said.
MAI is capitalised at just under GBP1 billion (about HK$12 billion), ranking just outside the top 100 largest companies listed on the London Stock Exchange.
