R.P. de La Sala – the Global Shipping and Industrial Magnate from HK

November 9, 2018 York Lo Articles, Hong Kong Companies, Manufacturing, Non-Hong Kong Companies, People, Property, Shipyards + Shipping

York Lo: R.P. de La Sala – the Global Shipping and Industrial Magnate from HK

Left: R.P. de La Sala (Brazilian immigration record, 1958); Right: Manners’ “West Breeze” as the first British vessel passing through the Suez in 1957 (British Pathe)

Robert Perez de La Sala (1908-1967, hereafter referred to as R.P., his Chinese obituary listed his Chinese name as 黎醒亞), the employee turned owner of Hong Kong-based Manners built a global shipping and industrial empire from the 1930s to 1960s which included a sizeable fleet of vessels (many of them with the word “Breeze” in its name) with over 200,000 deadweight tonnage and all kinds of businesses and properties stretching from Alaska to Australia including Shun Fung Ironworks, one of the largest producers of rebars in HK in the 1950s. When he died in Sydney in 1967, he was quoted in the papers as the richest man in Australia with an estimated fortune of over US$114 million (US$854 mil in 2018 dollars) and in recent years his heirs engaged in a high-profile fight in the Singaporean court over the massive family fortune which brought the tycoon’s name back to the spotlight.

From Spain to South Africa and Manila to HK: Family background

R.P. was born into the shipping business as his father Robert MacAndrew de La Sala (1873-1931, “R.M.”) was a well-known mariner whose career spanned multiple continents and survived four wars. Born in London and son of a Spanish general who fled to the UK after the Carlist Wars, R.M. apprenticed in the clippers of the London-based shipping firm McIlwraith McEacharn and earned his Master ticket at the age of 22. He worked on the South African, South American and Indian routes, shipping war supplies during the Boer Wars before moving to the Philippines in the turn of the century where he worked as a superintendent for the Manila Navigation Co until 1916 when he moved to HK.As captain of the ship “Pheumpenh” (owned by Li Shek-pang, the patriarch of the BEA Li family) which sailed between Saigon and HK, R.M. steered the vessel through a major typhoon in 1918. In the 1920s, he commanded several river vessels including “Sui Tai” which was burnt down during a fire which destroyed his belongings and almost claimed his life. Based on his experience, he wrote a textbook for mariners entitled “Let’s See”.

In April 1931, R.M.was forced to retire due to health reasons and two months later, he was found unconscious at his residence at 51 Bonham Road in HK due to an overdose of veronal. His first wife died in 1920 and he married Wong Mei-to, a Chinese girl from Tsinanfu (Jinan) in Shantung in 1929 in Canton. With his first wife, R.M. had 2 sons and 2 daughters and his eldest son Pastor served a term for the French Foreign Legion in Morocco before returning to HK to join the German firm of Reuter Brockelmann. In 1932, Pastor was charged with threatening to kill Major Louis Cassel, a business associate but was later acquitted.

John Manners & Co (免那洋行)

Born in Manila in 1908 and educated at St. Joseph’s College in HK and Seminario de Sao Jose in Macao, R.P. de la Sala joined the British shipping agent and import/export firm of John Manners & Co in HK in 1922 before he turned 14 as an apprentice. The firm was founded in 1915 in HK by John Manners, a former employee of the German trading house of Siemssen& Co whose operations in the British colony was suspended at the outbreak of World War I. The firm became Manners & Backhouse in 1916 when it joined forces with James H. Backhouse & Co. In 1923, Backhouse backed out of the firm and the firm’s name reverted to John Manners & Co with the Canton branch manager Wallace J. Hansen and F. Taylor joined as new shareholders. Born in New York in 1885, Hansen was of Danish descent and arrived in China in 1906. By 1930, a German national by the name of Karl Adolf AugustKastmann had joined Manners and Hansen on the board of the firm. Born in 1884, Kastmann first appeared in the HK Jurors List in 1906 as an assistant at Siemssen & Co.

Left: John Manners & Co’s ad in 1953 (Source: IDJ) Right: Ad of Manners Engineering in 1966 with the list of all the ships supplies and equipment they distribute (Port of HK, 1966)

From newspaper clippings of the 1920s and 1930s in HK, Manners served as shipping agent for ships owned by the Danish firm East Asiatic Co. By the late 1940s, it also represented insurance companies such as Sun Insurance Office of the UK (predecessor of Royal &Sun Alliance) and Great Eastern Life of Singapore and distributed products such as Philip Morris cigarettes and French cognac in Shanghai and audio equipment from British firms such as G.B. Kalee and Bush Radio in HK. Hansen and Kastmann were still involved with the firm at that point with Hansen serving as a director and owning 10% of the firm while Kastmann managed the firm’s export department but by then the ambitious R.P. had already taken over the firm. With his insatiable appetite for languages and work, R.P. rose quickly to the top at Manners in the 1930s and became its chairman and majority shareholder in January 1940 before he turned 32. Under his leadership, Manners was transformed from a shipping agent and trading firm to a major shipowner with industrial, real estate and mining interests across Asia, Australia and the US.

Left: Philip Morris ad in 1946 from John Manners & Co’s Shanghai branch which acted as its sole agent (China Weekly Review, 1946); Right: John Manners Shanghai brochure for Joseph Guy cognac and brandy.

Through Lasala Investments Ltd, which he incorporated in HK in 1939 (later renamed Northern Enterprises Ltd in 1959) and direct holding, R.P. controlled a long list of companies in HK by the 1950s including John Manners & Co., Ltd., Manners Engineering Ltd. (incorporated in 1946, dissolved in 2009), Manners Godowns, Ltd. (incorporated in 1947, renamed Carrington Navigation in 1962), Manners Trading Ltd (incorporated as John Manners & Co (Canton) Ltd in 1946, renamed in 1953 and dissolved in 1999), Manners Insurance, Ltd (formed in 1952, dissolved in 2003), U. Spalinger& Co Ltd (同和洋行, incorporated in 1947 and dissolved in 2009; this firm was founded in 1900 by the Swiss founder of the same name in Canton who used to work for Jardines and specialized in the silk trade) and Shun Fung Ironworks (to be discussed at length in the next section).R.P. also controlled a string of shipping companies including Manners Navigation Co Ltd (formed in 1947 as San Jeronimo Steamship Co Ltd, renamed in 1952), Cambay Prince Steamship (incorporated in 1938), Compass Shipping (formed as China Shipping in 1941, dissolved in 1999), Cronulla Shipping (formed as Samarinda Coal & Trading in 1941, renamed in 1967, dissolved in 1999), North Breeze Navigation (formed in 1958, dissolved in 1998) and South Breeze Navigation (formed in 1958, dissolved in 1999) and a series of Panamanian companies such as Compania de Navagacion Paloma, Isabel Navigation S.A. San Antonio, San Jeronimo, San Miguel, and San Fernando.

By 1960, the Manners group owned at least two dozen cargo steamships –“Yangtze Breeze” (7310 tons, built in 1945 as Empress Mauritius) ,“Wear Breeze”, “Tyne Breeze”, “Hongkong Breeze” (和風號,10,050 tons), “Sydney Breeze” (4944 tons, built in 1943 in Glasgow, acquired in 1956, broken up in 1970), “Suva Breeze” (built in 1943 in Fife, acquired in 1959 and broken up in 1969), “Kemlba Breeze”, “Torres Breeze” (3352 tons, built in 1920 and acquired in 1957), “Straits Breeze”, “Clyde Breeze”, “Troon Breeze”, “Tees Breeze”, “Yarra Breeze”, “Tweed Breeze”, “San Eduardo”, “San Roberto”, “Brenda”, “Asia Breeze” and “Cronulla”. Manners also controlled four vessels by the names of “East Breeze” (built in 1957 at the Kawasaki Dockyard in Kobe, sold to Pakistan in 1966), “South Breeze”, “West Breeze” and “North Breeze” (3342 tons, built in 1929, acquired from Scandinavia in 1955, broken by Fuji Marden in 1969), of which the 3604 tons freighter “West Breeze” (西風號) was the most famous since it was the first British ship to pass the Suez Canal after it was nationalized by the Egyptian government in 1957. In 1961, Manners appointed 30 years old Chan Tak-cheung (陳德祥) as captain of “Hong Kong Breeze”, the first Chinese to hold such position for a foreign-owned vessel. Two HK shipping tycoons – T.Y. Chao (趙從衍) of Wah Kwong and D.L. Wu (伍德鄰) of Taiship (泰山航運) also started their maritime careers at the Shanghai branch of Manners.

Manners’ Cronulla being refloated at Chinese Merchants pier in West Point in 1963 (SCMP)

During Typhoon Wanda in September 1962, the 2329 tons freighter “Cronulla” keeled over at the China Merchants company pier in West Point. The HK government gave Manners Navigation as the ship’s manager six months to shift the wreck as it was blocking the pier. When no buyers materialized, Chiap Hua Manufactory was granted the salvage job on condition that it was taken to Gin Drinkers Bay for scrap. As for the warehouse business, Manners had a godown at Soy Street in Mongkok in the late 1940s and still maintained 288,750 sq ft of godown space in Quarry Bay in the late 1960s.

As shown by the 1953 ad above, the Manners group was already a very global operation by the early 1950s with offices in London, New York, Sydney, Tokyo, Macau, Haiphong, Singapore, Jakarta and Dili in East Timor. In the early 1960s, R.P. established Australaska Corporation, Alaska Enterprises and Cosmopolitan Development in Alaskato, purchased real estate in Anchorage and sent his comptroller S.B. Mitford, who had worked for Manners HK as accountant for 9 years over to Alaska to help manage the interests. (Mitford worked there for 16 years but later sued the La Sala family over compensation). Concerned about estate duties in HK, R.P. also contemplated moving his primary base to Brazil where he had established a peanut oil factory in Ourinhos in the 1960s but ultimately picked Australia where he and his family eventually settled.

Manners’ “South Breeze” next to the Sydney Opera House (Shipsnostalgia)

Shun Fung Ironworks (信豐鋼鐵廠)

Left: Shun Fung Ironworks in Ma Tau Kok in 1965 (Land Use Survey, HKU Libraries), Right: Nissen, Leung and staff of Shun Fung greeting Governor Robert Black in 1958 (WKYP, 1958-9-18)

In Hong Kong, the most prominent industrial enterprise started by R.P. De La Sala was Shun Fung Ironworks, which was a leading producer of rebars, steel bars used for reinforcement of concrete in construction from the 1950s to 1980s.

Shun Fung was formed in 1951 when the De La Sala interests asked the 28 years old Leung Lai-yuen (梁醴源, also spelled Liang Lai-yuen, hereafter referred to as “L.Y. Leung”), the son of King’s Theatre proprietor Liang Chi-hao (梁基浩) and older brother of TV executive and politician Selina Chow who was involved in the soap making business to look into the accounts of the struggling Ying Fong Ironworks, which operated a manually operated rolling mill (a.k.a. “re-roller”) at 8-10 Ivy Street in Tai KokTsui which cut up steel plates of ships, melted them in furnace and rolled them into bars. The De La Salas and Leung took over the mill which was producing 200 metric tons of bars per month and renamed it Shun Fung. In 1953, Shun Fung established an automatic rolling “mini-mill” at423, To Kwa Wan Road in Ma Tau Kok with the first electric arc furnace (a 5-tons furnace) in HK, which was used to melt scrap metal for production of rebars. The next year, a 10 tons electric arc furnace was added and a third one was added in 1957, bringing its production to 15000 tons per year. At this point the firm had 130 workers between the two plants with R.P. as managing director and his lieutenants Leung, C. P. Nissen and B. P. C. Fletcher and his son Ernest Ferdinand de Lasala as directors.

Article about Shun Fung’s purchase of USS Shamrock Bay in 1959. Top picture is a British tugboat pulling the aircraft carrier into West Point while the bottom picture is the aircraft carrier itself.

By the late 1950s, Shun Fung was producing 14,000 metric tons per annum of round, mild steel rebar for Hong Kong’s building industry and well-known buildings as Tak Shing House, Kwong Wah Hospital, Kai Tak Air Freight Terminal and many others were constructed with Shun Fung’s rebars.It also had a foundry business which supplied pipes to clients such as China Light & Power. In September 1958, Governor Robert Black visited Shun Fung’s Ma Tau Kok plant (the same day he also visited V.K. Song & Co – see article and Chiaphua Flashlights) where he was greeted by Nissen, Leung and factory manager Ip Lai. At the time the plant had 400-450 workers, who were paid HK$5-12 per day. The 130,000 sq ft plant was producing 1500 tons of metal products per month. All the raw materials were scrap metal, some of which was imported though most of it came from shipbreakers with 95% of the mill’s output being sold to the local construction industry.

In 1959, Shun Fung made its highest profile purchase for source of scrap – the 10400 tons WWII US aircraft carrier “Shamrock Bay” – the first US warship purchased by a HK firm. Based on court records, it appears that Leung acquired Shun Fung from the De La Salas the same year for HK$2.2 million. It is unclear as to why the De La Salas decided to exit the Shun Fung business – R.P. himself had complained about the relative weakness of heavy industries in HK in 1958 as he found cheaper and better ships built in Japan for his own fleet and urged the HK government to provide more support for local industries in terms of land and infrastructure.

Left: article about Shun Fung adding its third electric arc furnace in 1957 (TKP, 1957-5-7); Right: R.P. de La Sala as Manners chairman urged the HK government to support the local shipbuilding industry (Kung Sheung Evening News, 1958-8-26)

With Leung as owner and managing director, Shun Fung continued its expansion. In February 1964, Shun Fung ordered its largest electric arc furnace yet which expanded its annual production capacity to 50,000 tons. As the Ma Tau Kok site became affected by Kai Tak airport expansion, Shun Fung purchased land in Junk Bay in 1962 where it completed construction of a much larger plant by 1967. Over time the Ma Tau Kok plant was closed in 1972 and all production was moved to the Junk Bay site.

In 1972, New World Development became the majority shareholder of Shun Fung while L.Y. continued to manage the business as managing director. L.Y.’s sons Roy and Len Leung joined the business in the 1970s and the firm achieved its highest profits of $6.9 million in 1974. With the backing of New World, Shun Fung’s production capacity went from 30000 tons to 100,000 tons and sales jumped to $8.9 million in 1972 to $101 million in 1982 but costs also spun out of control resulting year after year of losses. To add to that, the government announced plans to redevelop Junk Bay into Tseung Kwan O new town and resumed Shun Fung’s land, forcing it to close down in 1986 and relocate to Shunde in the mainland.

When the negotiation with the government over compensation failed, Shun Fung Ironworks filed a lawsuit against the HK government in 1988 seeking HK$800 million in damages. The lawsuit dragged on for years, with the Court of Appeal awarding HK$670 million in compensation to Shun Fung in 1993 only to have the decision overturned by the Privy Council in 1995.

Family Feud

Left: R.P. de La Sala (right with the long cigar) at the 1966 Australian Derby with jockey Neil Campton (left) who rode his “El Gordo” which won the race. (Sun Herald) Right: Chevron Hilton in Sydney

Outside of business, R.P. was a major racehorse owner, first in HK and from 1952 onwards in Australia where he owned champion horses such as “White Signals”, “Gordita” (two gold medals at the 1960 Rome Olympics), the “Summer Fiesta” (winner of the 1963 Australian Derby), “El Gordo” (winner of the 1966 Australian Derby, its name means “the Fat One” in Spanish) and “Clovelly” (winner of Lord’s Mayor Cup at Rosehill the Saturday before R.P. died in 1967). Aside from horses, the family has operated John Manners & Co (Australia) Pty Ltd and built up a large portfolio of property holdings in Australia including the office building De La Sala House on Clarence Street in Sydney and the Chevron Hilton Hotel in Sydney (first postwar modern hotel in the city), which was acquired in 1963 in partnership with two other businessmen.

R.P. married Camila Vasquez in HK with whom he had five children (by order of birth): Tony (1931), Ernest (1933), Bobby (1935), Edward (1936-1950), and Isabel (1943), all of whom were educated in Australia. Having started working early in his life, R.P. attempted to retire as early as 1952 at his 30^th anniversary with Manners by making his brother in law Bertram Peter Charles Fletcher (B.P.C., he married Benita, the sister of R.P.’s wife Camila) and his lieutenant C.P. Nissen joint managing directors of the firm and then fully retire by 1958. The turmoil in the shipping industry and his reluctance to let go pushed these plans back year after year and he was still in charge in April 1967 when he died suddenly in his sleep in Sydney, weeks before his scheduled retirement in June 1967.

His eldest son Tony was not interested in shipping and business and after a brief stint at Manners in HK returned to Australia where he managed a shopping center owned by the family later in his life. His second son Ernest started at Manners Australia in 1952 and joined the board of Manners HK in 1953 and became joint managing director with his father in 1957 and ultimately took over the family business and acquired Tony and Isabel’s shares in the group. Over time, Ernest shifted the base of the family business to Singapore where John Manners & Co (Malaya) Pte. Ltd had been established since 1948 while the rest of his family stayed in Australia. Ernest was supported by Malcolm Blair Morrison, Christian Williams Ostenfeld (joined in 1955 as first mate, became a director in 1958 and promoted to deputy managing director by 1964), F.W.L. Miller and Matthew Ku Yun-ting in the 1960s through 1980s.

Through the 1990s, Ernest cashed out of physical ship owning and various business and built up a large portfolio of liquid assets. After R.P.’s wife Camila, the family matriarch, died in 2005, 4 years of suits and countersuits took place in Singapore between family members starting in 2012 as Ernest was accused by his nephew and niece of transferring US$600-800 million of the family fortune to his personal accounts in 2011. In 2017, Justice Quentin Loh of Singapore ordered Ernest to pay damages to his relatives.

Sources
The Singapore Free Press and Mercantile Advertiser, 10 June 1931, Page 17

https://www.supremecourt.gov.sg/docs/default-source/module-document/judgement/s178-12-amended-last-page-pdf.pdf

The Hong Kong Telegraph, 1932-10-14

大公報, 1957-04-20, 1957-5-7, 1965-6-18, 1988-10-18

Video of “West Breeze” passing the Suez in 1957: