Jardines (company)
Jardine Matheson Holdings Limited is a Hong Kong–based, Bermuda–domiciled and British–founded multinational conglomerate. It has a primary listing on the London Stock Exchange and secondary listings on the Singapore Exchange and Bermuda Stock Exchange.
The majority of its business interests are in Asia, and its subsidiaries include Jardine Pacific, Jardine Motors, Hongkong Land, Jardine Strategic Holdings, DFI Retail Group, Mandarin Oriental Hotel Group, Jardine Cycle & Carriage and Astra International. It set up the Jardine Scholarship in 1982 and Mindset, a mental health-focused charity, in 2002.
Jardines was one of the original Hong Kong trading houses or hongs that date back to Imperial China. 58 percent of the company's profits were earned in China in 2019. The company is controlled by the Keswick family, who are descendants of co-founder William Jardine's older sister, Jean Johnstone.
Jardine Matheson is a Fortune Global 500 company. In 2013, both Jardine Matheson and Jardine Strategic were among the top 200 publicly traded companies in the world, as valued by market capitalisation. It is also a component of Forbes Global 2000.
History
19th century to WWII: The early days
The firm of Jardine, Matheson & Company emerged in 1832 from an evolving process of partnership changes in the trading business Cox & Reid, a partnership established in 1782 between John Cox and John Reid, the latter having been agent of the Austrian trading company, Trieste Company.University of Edinburgh Medical School graduate William Jardine joined the firm, by then having morphed through Cox & Beale, Beale & Company and Beale & Magniac into Magniac & Company, and the original partners long gone, in 1825 at the invitation of principal Hollingworth Magniac. University of Edinburgh graduate James Matheson joined three years later as Magniac prepared to retire. With the cession of Hong Kong under the 1842 Treaty of Nanking, the firm, by then named Jardine, Matheson & Company, set up its headquarters on the island and grew rapidly, smuggling illegal opium from British-controlled India into China. Jardine Matheson has been called the "most successful opium smuggling company in the world".
Both Jardine and Matheson became members of Parliament in Britain, and Matheson also bought the entire Scottish island of Lewis, clearing over 500 families off the land and shipping them to Canada in order to build Lews Castle. Continuing its longstanding trade in smuggled opium, tea, and cotton, the firm diversified into other areas including insurance, shipping, and railways.
By the mid-19th century, the company had become the largest of the hongs or foreign trading conglomerates with offices in all the important Chinese cities as well as Yokohama, Japan. One of its branch agencies, Glover and Co., established in Nagasaki, was known in Japan as an arms dealer who contracted with then-rebel forces from Chōshū Domain who led the Meiji Restoration in 1868.
Jardine Matheson invested in the first commercial railroad in China, the Wusong-Shanghai railroad. It was built in July 1876, bought by the Qing dynasty the next year, and demolished the next year.
In the early decades of the 20th century, Jardines built cotton mills, a press packing plant, and a brewery in Shanghai while expanding into Africa, America, and Australia. When war came to China in 1937, the firm suffered heavily both in Hong Kong and in mainland China.
After the 1949 foundation of the People's Republic of China, trading conditions for foreign companies under the new Communist regime became increasingly difficult.
Post-WWII restructuring and expansion
The firm listed in Hong Kong in 1961. The landmark Mandarin Hotel opened in Hong Kong in 1963 as the city's first five star hotel.In 1970, Jardine Fleming, the first merchant bank in Asia, opened for business while a real estate company and sugar plantations in Hawaii and the Philippines were acquired. A Hong Kong building boom in the mid 1970s saw Jardine's buy Gammon Construction, the largest construction and civil engineering group on the island. A presence was re-established on the mainland in 1979 following China's reform and opening up and a year later the firm established the Beijing Air Catering, the first foreign joint venture in the country since 1954. During the 1970s Jardines also expanded their insurance interests with acquisitions in the United Kingdom and the United States laying the groundwork for the foundation of Jardine Insurance Brokers.
By 1980, the firm had operations in southern Africa, Australia, China, Great Britain, Hong Kong, Indonesia, Japan, Malaysia, Philippines, Saudi Arabia, Singapore, South Korea, Taiwan, Thailand, as well as the United States, and employed 37,000 people. After re-domiciling to Bermuda in 1984 ahead of the 1997 handover of Hong Kong, in 1990 Jardine Matheson Holdings and four other listed group companies arranged primary share listings on the London Stock Exchange in addition to their Hong Kong listings. Other significant developments during this decade included the merging of Jardine Insurance Brokers with Lloyd Thompson to form Jardine Lloyd Thompson, the acquisition of a 16% interest in Singapore blue-chip Cycle & Carriage and Dairy Farm’s purchase of a significant stake in Indonesia's leading supermarket group Hero. Hotel brand Mandarin Oriental also embarked on a strategy to double its available rooms and improve returns.
The first decade of the new millennium saw Jardine Cycle & Carriage acquire an initial 31% stake in Astra International, which has since been increased to just over 50%. Hongkong Land became a Group subsidiary for the first time following a multi-year programme of steady open market purchases while Jardine Pacific raised its interest in Hong Kong Air Cargo Terminals Limited from 25% to 42%.
In 2018, Jardines sold its 41% interest in Jardine Lloyd Thompson to Marsh and McLennan Companies.
With the coming of a new generation of Keswick family leadership, diversification of assets has slowed down and the firm has focused more on consolidation of existing properties. Contrary to public perception of the firm avoiding investing into mainland China, preferring instead to seek profits in Southeast Asia, its subsidiary Hongkong Land spent 4.4 billion dollars buying a plot of land in Shanghai which, according to Jonathan Galligan of CLSA, signifies its commitment to doing business in mainland China. Moreover, according to informal calculations by Bloomberg, in 2019 the share of company profits from mainland business ventures is the third largest at 255.4 million USD. All in all, as of 2021 the company's annual report states that 55% of its profits come from China, as opposed to 42% and 3% earned in Southeast Asia and the rest of the world respectively.
Following a restructuring of the complex shareholding system designed to prevent a hostile takeover in 2021, Jardine Matheson consolidated Jardine Strategic as a wholly owned subsidiary.
21st-century operations
Jardines today comprises a group of companies with extensive operations across Asia and, through some of its businesses, the world. The firm's business interests include Jardine Pacific, Jardine Motors, Hongkong Land, Dairy Farm, Mandarin Oriental, Jardine Cycle & Carriage, through which its interest in Astra is held. The Group also has strategic interests in other entities.Jardine Pacific
Jardine Pacific is a holding company which represents a significant number of the Group's non-listed interests in Asia, principally in engineering and construction, transport services, restaurants and IT services. These include a number of Jardines’ long-standing businesses such as Jardine Engineering Corporation, Jardine Aviation Services, Hong Kong Air Cargo Terminals, Jardine Schindler, Gammon Construction as well as more contemporary interests that reflect the demands of Asian consumers; among them Pizza Hut restaurants in Hong Kong, Taiwan, Vietnam and Myanmar, KFC franchises in Hong Kong, Macau and Taiwan. Pizza Hut and KFC operations are under Jardine Restaurant Group.Jardine Motors
Jardine Motors is active in the sales and service of motor vehicles in Hong Kong, Macau, mainland China and the United Kingdom.Subsidiary Zung Fu, which has held the Mercedes-Benz luxury vehicle franchise in Hong Kong for over 50 years, has achieved one of the highest market penetrations in the world for the luxury brand and ranks among its top international performers. The group also represents Smart and Hyundai passenger cars in Hong Kong. Zung Fu is expanding its presence across the growing market of Southern China where it is actively developing a network of Mercedes-Benz dealerships.
In the United Kingdom, Jardine Motors is one of the country's largest retail dealership groups with a portfolio of specialist franchises that includes Aston Martin, Audi and Volkswagen, Jaguar and Land Rover, Mercedes Benz and Porsche.
Hongkong Land
Hongkong Land is an Asian property investment, management and development group. Established in Hong Kong in 1889 by Sir Paul Chater and William Keswick, the group today has property interests across the region. In Hong Kong, the group owns and manages approximately 9,140,000 square feet of prime commercial space in Central. In Singapore, it is helping to create the city-state's Central Business District with an expanding joint venture portfolio of new developments. In addition to commercial properties, Hongkong Land also develops residential properties in key cities around the region including Hong Kong, mainland China, Macau and Singapore where its subsidiary MCL Land is a significant property developer. Jardine Strategic has a 53% shareholding in Hongkong Land.DFI Retail Group
DFI Retail Group traces its origins in Hong Kong back to the 19th century when it was involved in the production of dairy products and ice. Today the company is a leading pan-Asian retailer. The Dairy Farm group's retail operations range from grocery retail and health and beauty stores to convenience and home furnishings, operating under a number of well-known local brands. It has a significant presence in Hong Kong, Macau, Malaysia, Singapore, Taiwan, and Indonesia, and a growing presence in China, India and Vietnam.Dairy Farm operates supermarkets under the banners of Wellcome, Jasons, Shop N Save, Cold Storage, Hero, Yonghui, and MarketPlace; hypermarkets under the Giant brand; health and beauty stores under Mannings and Guardian; IKEA furniture stores in Hong Kong, Macau, Indonesia, and Taiwan; as well as 7-Eleven convenience stores. The group also has a 50% interest in Maxim's, Hong Kong's leading restaurant chain.
Jardine Strategic has a 78% shareholding in Dairy Farm., Dairy Farm owned 70% of the shares of Lucky Group, the largest grocery mall operator in Cambodia.