Jimmy Lai Chee-ying, who is on bail awaiting trial on a charge of breaking the national security law, has resigned as chairman of the media publishing company he founded to “deal with his personal affairs,” according to a statement by the publisher of the Apple Daily newspaper.
Lai, 73, “has no disagreement” with the board of directors of Next Digital Limited and there is “no other matter that needs to be brought to the attention of the shareholders,” the company said, adding that the board has appointed non-executive director Ip Yut-kin as the chairman with immediate effect.
Lai, who founded Apple Daily in 1995, was released on a HK$10 million (US$1.29 million) bail on Christmas Eve after 20 days in custody over allegations of endangering national security and fraud. Hong Kong prosecutors plan to file an urgent appeal against his bail release on New Year’s Eve.
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The media tycoon has used his Apple Daily tabloid and his Twitter account to call for sanctions against Hong Kong and China’s authorities, according to a document prosecutors submitted to court on December 12. His resignation is seen by analysts a move to draw a line between himself and the publishing empire he founded, currently valued at HK$685 million. Next Digital also published the Next Magazine, which switched to an online version in 2018, ending two decade of its print run.
“Lai’s resignation will have a positive impact on the near-term share price of Next Digital, as he has distanced himself from the company,” said Tom Chan Pak-lam, chairman of the Institute of Securities Dealer, a guild for the brokerage industry in Hong Kong. “It is normal for executives of listed companies to resign when they face court cases.”
Lai has been granted bail in three other cases related to last year’s anti-government protests in Hong Kong and in another over this year’s banned Tiananmen Square vigil. He will stand trial at the Wan Chai District Court in February 2021 and at the West Kowloon Court in April.
His successor Ip, 69, has been a veteran in the Next Digital group since Apple Daily’s first publication. He was the group’s chief executive overseeing all the operations of Next Digital’s newspaper and magazines in Hong Kong and Taiwan, as well as acting as the publisher of Apple Daily.
Ip was appointed as non-executive chairman of the company between June 2016 and January 2018. He previously worked at other media organisations in Hong Kong after graduated from the National Chengchi University of Taiwan with a Bachelor’s degree in Social Sciences (Journalism).
“The successor is a group veteran who should be able to maintain the quality of the management” and help the publisher steer through one of the most challenging periods in the media business, Chan said. “In the longer-term, the company’s outlook would still depend of its new management’s policies and the overall economic environment.”
Ip received a directors fee of HK$200,000 per year for a term of two years. He and his family own 12.83 million shares of Next Digital, valued at HK$3.34 million as of Tuesday’s close at 26 Hong Kong cents per share.
Shares of Next Digital have seen some volatile trading this year, soaring 12-fold over two days in early August following Lai’s arrest by Hong Kong police, only to collapse by 99 per cent in subsequent days.
The volatile trading of Next Digital shares earned a rebuke from the city’s financial regulator, which said it was looking into possible stocks manipulation. Fifteen people were arrested a month later in connection with the stock’s volatile trading.
Buying the stock became a popular way for Hong Kong’s anti-government activists to show support for Lai following his arrest, along with snapping up copies of his Apple Daily newspaper.
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