Diversification
1978 saw the start of a severe downturn in the shipping business. Pao and his managers were quick to spot the problem and commenced a programme to reduce the fleet, especially crude oil carriers, selling ships as they came off charter. 140 ships were sold and the fleet reduced by half over a period of 4 to 5 years allowing debt to be paid off and cash resources built up. Although this was a difficult time for World-Wide, the company, through early action and conservative financial management, was able to ride the recession with little of the problems seen elsewhere in the industry.
In the mid 1970s Pao had bought from Li Ka Shing a ten per cent holding in the Hong Kong and Kowloon Wharf and Godown Co. Ltd and by 1977 had built this to 30%. Wharf had historically been in the Jardine Matheson sphere of influence. Friction with the Jardine camp broke out in the late 1970s over board appointments which concluded with the Pao camp being allowed two more directorships (making 4 out of a total 12). Hostilities broke out again in June 1980 with Jardines launching a cash and shares bid for Wharf. Although in Europe at the time, Pao and his team were able rapidly to put together a successful cash tender for shares to take his holding to 49% and securing control of Wharf. Pao then took over the roles of Chairman and Chief Executive. Wharf gave World-Wide exposure to prime Kowloon waterfront property as well as ownership of Hong Kong Tramway and the Star Ferry.
In 1985 Pao was able to take control of Wheelock Marden, one of Hong Kong's premier companies established in 1857, when John Cheung sold his 34% stake to Pao forming a core shareholding from which to launch a bid in opposition to the bid from Tan Sri Koo Teck Puat who had bought John Marden's stake in the company. Wheelock gave World-Wide exposure to more prime central Hong Kong property as well as the Lane Crawford department store.
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