The Rise and Disappearance of Kin Son Electronic (建生電子)

York Lo: The Rise and Disappearance of Kin Son Electronic (建生電子)

Kin Son Electronic Image 1 York Lo Left: So Kin-keung (front) Right: article about Kin Son’s earnings in 1991 (WKYP, 1991-10-4) 

In 1995, the business world in Hong Kong was shocked by the unraveling of the publicly listed Kin Son Electronic (Holdings) Ltd, starting with the disappearance of its chairman So Kin-keung (蘇健強) in Shenzhen in July, the revelation of its financial troubles and its subsequent collapse and ripple effects to other firms such as Yeebo as a result.  Founded in 1981 by So and his wife Chan Suk-kan (陳淑勤), Kin Son went public on the Stock Exchange of HK in June 1988 and was one of the largest local electronic manufacturers before its dramatic collapse.     

So Kin-keung was a native of Chamkong (湛江) in Guangdong province. Born in 1945, he came to Hong Kong with his father at the age of 8 in 1953 and started working as an apprentice at a weaving mill after dropping out of middle school. Within 3 years, he became a manager and by the age of 21, he started his first business with his friend – a watch factory which he owned less than 10%. Despite a decade of hard work, the business was loss-making and as a result, So Kin-keung decided to strike out on his own in 1981 by starting Kin Son Electronic (although the firm was incorporated in 1980) to manufacture electronic watches. His timing proved to be correct as Kin Son was doing HK$200 million in sales by 1983 and in 1984, the firm began to branch out into other electronic products such as calculators. It exhibited its calculators at the Consumer Electronics Show in June 1984 and was making 1.8-2 million calculators per month within a few years. The same year, it also extended to higher margin LCD watches which was an instant hit with big contracts from West Germany and monthly production soon exceeded 800,000. Sales jumped to $300 million in 1984 and exceeded $400 million in 1985.  

In 1986, the firm extended its reach to audio video equipment by launching 4 ½ inch portable black and white TV sets and cassette tape recorders and soon was making 10,000 mini TV sets, 20,000 cassette recorders and 40,000 clock radios monthly. Kin Son Audio Ltd was incorporated in 1987 to coordinate this line of business. Due to the macroeconomic slowdown in the mainland, Kin Son’s sales dropped back to $200 million in 1986 but rebounded to over $300 million in 1987. 

In 1987, the firm expanded into camera production through the formation of Kin Son Photographic Ltd, starting with low-price mini cameras for children which was a hit. It became a key supplier to Hanimex, the Australian camera firm founded in 1947 which was also the owner of the Vivitar brand in the US since 1985. Kin Son manufactured Hanimex and Vivitar brands of cameras which at one point represented over 30% of the group’s sales. According to So, Hanimex was interested to buy 20% of Kin Son at its IPO but he turned it down as he did not want to become too dependent on the Australian firm. 

Kin Son Electronic Image 2 York LoHanimex 35 DL camera made by Kin Son which was also marketed as Kin Son 35 DL 

By 1987, Kin Son had over 1000 clients from all over the globe, three floors of factory space totaling 60,000 sq ft and over 600 employees in Hong Kong and two plants in Zhaoqing and Sansui in Guangdong with total factory space of over 30,000 sq ft and over 1500 workers. (WKYP, 1987-10-21) 

In late 1987, Kin Son tried to go public but the plans were postponed due to the global stock market crash in October. For the fiscal year ending April 1988, Kin Son did sales of $386 million, a 14% increase from the prior year with post-tax earnings of $18 million, a 70% jump. (WKYP, 1989-1-19) 

In July 1988, Kin Son went public through the issuance of 50 million shares (25% of the firm) at 90 cents apiece, raising $42 million and valuation of roughly 6 times PE. The IPO was subscribed by French, Japanese and Taiwanese investors and according to So, $20 million of the proceeds was intended to pay off current liabilities, $10 million for development of a new plant in Sansui and the rest for research and development (TKP, 1988-6-29) 

Kin Son (2)

IPO notice of Kin Son Electronic in 1988 (TKP, 1988-7-7)

In 1990, Kin Son sold 10% of firm to Taiwanese interests through new issuance of shares for $33 million and the firm was valued at over HK$330 million, with majority of its shares held by So and his wife. (1990-4-10 TKP). The same year, Kin Son Telecoms was established to make telephones but the business proved to be difficult so the Group reduced its stake in the firm from 70% to 16.8% in 1992 to re-focus on cameras and household appliances.  

For fiscal year ending April 1991, Kin Son recorded revenues of $548 million, a 10.4% increase from the prior year and earnings of $20 million, a 14% drop. (WKYP, 1991-10-4) In 1991, Kin Son formed a 50/50  joint venture with Seagull Co of China to produce, distribute and service cameras in China. (Business China, 1991) 

For the year ending April 1994, Kin Son’s revenues fell 18% to $419 million although its earnings doubled to $2 million. By this time, So Kin-keung became very involved in the property market in the mainland which proved to be his undoing.  

In July 3, 1995, So Kin-keung became missing during a visit to Shenzhen. At first, kidnapping was suspected but soon it became clear that So had skipped town as creditors ranging from People’s Construction Bank of Shenzhen to Daiwa Bank to LCD maker Yeebo emerged seeking money from Kin Son or So. (Eastern Express, 1995-7-11) So had served on the board of Yeebo and was close friend with Yeebo chairman Makie Hui Po-yuen (see Conic article for more about the firm) who had personally lend or guaranteed loans with his own Yeebo shares as pledges.  Unable to meet its liabilities, Kin Son’s board held a special board meeting on July 31 voted to wind up the business.  

In 1998, Plotio acquired the listed share of Kin Son from its liquidators for HK$35 million and currently the listed share is known Qingdao International. 


This article was first posted on 27th September 2019.

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