New World CEO Replaced After Just Two Months On The Job, Succeeded By Chinese Subsidiary Boss Echo Huang

Eric Ma, CEO of the Hong Kong billionaire Cheng family’s flagship New World Development, has resigned from the top job. The surprise announcement comes just two months after Ma, who was COO of New World, replaced Adrian Cheng, the third-generation scion of the Cheng family, to stabilize the debt-laden property developer.

Effective immediately, Ma was succeeded by Echo Huang, an executive director of the company and CEO of subsidiary New World China Land since 2020, New World announced in a filing to the Hong Kong stock exchange on Friday. Ma, who said he had resigned to “pursue his other personal commitments,” also stepped down from the board.

Shares of New World on the Hong Kong stock exchange plummeted 6% on Friday after media reports about the leadership change, before they were suspended for trading.

“Having reviewed the development direction of the Group, I understand that timely phased changes need to be made, and the role of the CEO also requires to be adjusted. I am very pleased to have found a more suitable candidate,” New World chairman Henry Cheng, the patriarch of the Cheng family, said in a press release.

“With Ms. Huang’s extensive experience in real estate and corporate management, as well as her outstanding achievements in assisting the Group with real estate development and investment management in Hong Kong and mainland China, I look forward to her playing a more significant role in the Group’s future development and synergies,” Henry added.

Huang was previously a managing director at Sun Hung Kai Properties, another major Hong Kong property developer controlled by a billionaire family—the Kwoks. She joined New World China Land as deputy CEO in 2015 and was promoted to the top job at the company in 2020.

“Since joining the Group, Ms. Huang has made outstanding contributions in promoting design and construction progress and quality, enhancing corporate branding, increasing sales and leasing returns, and strengthening corporate governance,” New World said in the press release.

The unexpected departure of Ma cast a shadow over New World’s efforts to turn around its struggling business amid property downturns in Hong Kong and mainland China. Ma only in September replaced Adrian, the eldest son of Henry, after he resigned from the top job to focus on public service amid the company’s mounting losses.

New World reported a net loss of HK$19.7 billion ($2.5 billion) in the year ended June 30, the worst since the late Cheng Yu-tung founded the property developer in 1970, on top of a 34% plunge in revenue to HK$35.8 billion. During the same period, its net gearing rose to 55% from 47.7%, far higher than its peers.

The lackluster financial performance has dragged down New World’s shares, which plummeted more than 45% over the past year. The company is set to be removed from Hong Kong’s benchmark Hang Seng Index next month, depriving its status as one of the city’s longest-tenured blue-chip stocks.

The management shake-up comes as New World is trying to improve its liquidity. On Thursday, the property developer received approval from the government to sell its stake in a mega sports venture development in Hong Kong’s Kai Tak area to shareholder Chow Tai Fook Enterprises, the private investment firm of the Cheng’s family.

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