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Harpers International Limited
At the Macau Grand Prix in November 1963, Bob Harper informed Mr Wyllie that because of dissatisfaction with his company's sales and management performance, the FORD MOTOR COMPANY had established a new dealer for Hong Kong and Kowloon, and for the first time split the franchise which WALLACE HARPER had held exclusively since 1922. Bob Harper also confided to Mr Wyllie that his company was in severe financial difficulty due to continuing operating losses from poorly planned and managed investments into other unrelated businesses.
In December 1963, Mr Wyllie spent two weeks in Hong Kong interviewing the management of WALLACE HARPER's various businesses and analysing the accounts and financial records of each of them. His report on the company's state of affairs revealed that net shareholders' funds were down to HK$1 million and that the company had lost HK$1.1 million in 1963 and was continuing to operate with unsustainable losses.
Mr Wyllie informed Bob Harper and his sister, who jointly owned WALLACE HARPER, that if the company was to survive the loss of half its current car and truck franchise, very urgent action needed to be taken. His recommendation was to eliminate all the subsidiaries that were losing money, to reduce staffing numbers and to streamline and improve the management and performance of the car and truck operations in Hong Kong and Kowloon.
A meeting was arranged with the group's bankers, who agreed to a moratorium on debt repayments subject to a change in management and the adoption of Mr Wyllie's proposals. Bob Harper then offered Mr Wyllie the position of Managing Director with an option, valid for 5 years, over one-third of the company for its then net worth.
Mr Wyllie accepted the offer, resigned from WEARNE BROTHERS and, in May 1964, moved to Hong Kong which was to become his home for close to the next 30 years. Although he did not know it at the time, this move marked the beginning of a lucrative and personally rewarding career in corporate rescue and the reorganisation of financially troubled companies.
WALLACE HARPER broke even in 1964 despite the financial crisis and numerous bank failures which rocked Hong Kong in 1965, the STAR FERRY riots which followed in 1966 and then the infamous RED GUARD riots which in 1967 overflowed into Hong Kong from China's Cultural Revolution and brought business in the Colony almost to a standstill. The company continued to prosper and moved into steadily increasing profits.
In 1967, Mr Wyllie exercised his stock option at a cost of HK$330,000 and became a one-third shareholder. A new holding company, HARPERS INTERNATIONAL LTD (Harpers), was then formed to acquire WALLACE HARPER and its surviving subsidiaries. Then in 1968, HARPERS launched successful bids to acquire firstly the second Ford dealer, thus regaining exclusive control over the FORD car and truck franchises, and then in quick succession, the BMW and MITSUBISHI dealerships which were each set up as semi-autonomous businesses under HARPERS INTERNATIONAL.
A half share in the ALFA-ROMEO dealership was also purchased during the year, and by the end of 1968 HARPERS was firmly established as the largest and most profitable automobile-dealing group in the Colony. In that year HARPERS also established a retail finance company in joint venture with STANDARD CHARTERED BANK. WALLACE HARPER, as a wholly owned subsidiary, became FORD OF BRITAIN'S largest dealer in the world for built-up product.