About Swire

Swire dates its history to 1816 and the establishment of a small import-export company in Liverpool, UK. Its founder, John Swire (1793-1847), built a successful import-export business, based mainly on the textile trade. His sons, John Samuel (1825-1898) and William Hudson (1830-1884) took the firm overseas and it was John Samuel Swire in particular whose entrepreneurial instincts would be at the root of the firm's successes in years to come. In his 20s he travelled widely throughout the USA - at one stage, reputedly holding the postal franchise for the State of Arkansas - and in 1854, he sailed for Australia to prospect fruitlessly for gold, but more successfully for new business, opening a branch office in Melbourne in 1855. "Swire Bros." was the basis for a growing trade to Australia in goods ranging from fencing wire and cement to olive oil and Guinness - which John Swire & Sons later bottled and exported as Dagger Stout.

China and Beyond

Returning to Liverpool in 1859, John Swire began to trade with China after the outbreak of the American Civil War in 1861 started to disrupt imports of cotton from the Southern States - a key element of his textile trade. Dissatisfied with the agents he employed to handle his business in China, he decided to take matters into his own hands. In 1866 he arrived in Shanghai, and on 4th December that year, the following advertisement appeared in the North China Daily News:

Notice We have established ourselves As merchants under the firm of Butterfield & Swire: Richard Shackleton Butterfield John Samuel Swire William Hudson Swire Taikoo Zuen Hong, corner of Foochow and Szechuen Roads, formerly occupied by Messrs Fletcher & Co.

Richard Shackleton Butterfield, a Yorkshire worsted manufacturer, was one of John Swire's principal UK export clients. However, he was to prove a short-term partner. Within 18 months the partnership had been dissolved: 'He was grasping and he bothered me,' Swire later wrote. At Butterfield's request, there were no press announcements of the breakup, and Swire's Asian offices kept the name Butterfield & Swire (B&S) into the 1970s. In keeping with local tradition, however, John Swire had already chosen a Chinese "hong" name for the company, and it is by the name Taikoo (太古) - meaning "Great and Ancient" - that Swire is most widely known in Asia today.

Initially trading in tea and silk and British imports of cotton and woollen 'piece goods', Taikoo also became agent in China for a number of UK businesses, including leading shipping and insurance companies. Notable amongst these was the newly formed Liverpool shipping line, Ocean Steam Ship Company - later better known as Blue Funnel - for which Swire was managing agent in Asia for 120 years. By 1900, Butterfield & Swire had Shanghai's biggest fire insurance business and a sizeable marine and accident portfolio, and insurance would remain an important side of the business for another 90 years. The firm soon had branch offices in Yokohama (1867), at a number of China coast ports, and from 1870, in Hong Kong. In the early days, 'B&S' also acted as a banking agent at some of the smaller coastal ports, and at one time even printed its own "banknotes" - drawn upon the Taikoo Tsng or "Swire Bank".

New Fields of Enterprise

John Swire soon spotted a new opportunity: the Yangtze River was a vital link with China's interior at a time when there were few roads in the country and railways had yet to be built. However, the majority of river trade was carried by junk, with only limited steamer traffic. In 1872, Swire established The China Navigation Company, beginning a passenger and cargo service to inland ports using Mississippistyle paddle-steamers; within a few years the company was also operating ships on the China coast, before spreading its network of services further afield to Japan, Southeast Asia and Australia. The rapid expansion of China Navigation was largely based on profits from cargoes of "beancake", which its vessels carried on the China coast. Produced in Manchuria as a by-product of the soybean oil industry, "beancake" consisted of dried soybean husks, which were compressed into large "cakes" and used on the land as a fertiliser.

The shipping business gave rise to other new ventures. In 1881, Swire purchased several large blocks of land in Hong Kong and work soon commenced on the Taikoo Sugar Refinery, which went into production in 1883. Encouraged by China Navigation's growing trade in raw cane sugar from Java, the Philippines and North Queensland, and ready markets in China and Japan, Taikoo Sugar ran one of the world's largest and most sophisticated plants in its day.

Hong Kong would also prove the ideal setting for a dockyard to handle the repair and construction needs of the expanding shipping fleet. Taikoo Dockyard launched its first riverboat for China Navigation, Shasi, in 1910, and went on to become one of Hong Kong's biggest, and also one of its most progressive employers, providing its own housing, hospital and school.

The next three decades would see considerable expansion of Swire's shipping business under the guidance of John Samuel Swire's two sons, John - known as "Jack" - (1861-1933) and Warren Swire (1883-1949), with further new business ventures including a tug and lighter company on the Heiho River at Tianjin, and the establishment of one of Shanghai's leading paint manufacturers, Orient Paint & Varnish, in 1934.

Fortunes of War

World War II very nearly destroyed this burgeoning empire. By 1945, the Taikoo Sugar Refinery and Taikoo Dockyard had been reduced to rubble during American bombing raids on Japanese-occupied Hong Kong; more than 30 China Navigation vessels had been captured or sunk, and company properties throughout the region had been destroyed or looted. The Yangtze River was closed to foreign shipping from 1942 and increasing restrictions on shipping on the China coast foreshadowed the firm's gradual withdrawal from Mainland China, following the Revolution of 1949.

In the lean years immediately following World War II, Swire played a major part in resurrecting Hong Kong's trade, devastated by almost four years of occupation, and concentrated on rebuilding its key operational businesses; by 1950, major local employers Taikoo Sugar and Taikoo Dockyard were back in full production, and Swire's paint manufacturing business had been transferred from Shanghai to Hong Kong, under the name Swire Duro. The firm's shipping arm, China Navigation, meanwhile began to establish new services to Australia and the Pacific, building a growing network of services that became the pattern for the trades in which the company operates to this day.

Swire was by now under the leadership of John Samuel Swire's grandson, John - "Jock" - Kidston Swire (1893-1983), who became Chairman in 1946. Jock Swire was determined to find new and better opportunities for the firm. Recognising that air transport was the key to the future, he looked for ways of involving Swire in this industry and in 1947 used Taikoo Dockyard's engineering skills to develop an aircraft repair and maintenance facility at Hong Kong's Kai Tak Airfield. This company, named Pacific Air Maintenance Services (PAMAS), merged with rival Jardine Air Maintenance Company in 1950 to form Hong Kong Aircraft Engineering Company (HAECO) - today one of the world's leaders in its field.

The Birth of an Airline

PAMAS' principal customer in those early days was local airline Cathay Pacific Airways. Cathay's founders, Roy Farrell and Sydney de Kantzow - respectively an American and an Australian - had met during the war, while piloting dangerous relief flights into China from India for CNAC. In 1945, Roy and Syd saw an opportunity to start passenger and cargo flights out of Shanghai. Early in 1946, they moved their enterprise to Hong Kong, and in September of the same year, paid HK$1 apiece to register the airline. They named it Cathay Pacific Airways, because Cathay was the ancient name for China and far-sighted Roy Farrell speculated that one day the airline would fly across the Pacific Ocean.

Beginning with Betsy, a US Army surplus DC3 (Dakota), by 1948 they had enlarged their fleet to six DC3s and a Catalina flying boat. In the same year, the Hong Kong Government decreed Syd and Roy must reduce the "foreign" - i.e. American - element of the airline's shareholding to just 10% or lose their landing rights in the then British Colony. It was at this point that Swire stepped into the picture, quickly reaching agreement with Syd and Roy to buy a management stake in the company. From then on, the growth of Hong Kong's airline was to become Jock Swire's special pride. By the early 1960s, Cathay Pacific had entered the jet-age with the arrival of its first Convair-880M in 1962, and had added air catering and ramp handling to its interests.

New Directions

The 1950s-1970s saw Swire diversify into a number of key new industries. In 1952, the company re-established headquarters in Australia and began to invest in the road haulage and cold storage sectors, commencing with freezer transport company, Frigmobile, which by 1958 was the biggest refrigerated truck operator in Australia and remains one of Swire's most high profile brands there to this day. Australia was also the focus for Swire's shipping services and from here, China Navigation became a major force in opening up largely undeveloped trades to Papua New Guinea and the Pacific islands.

In 1965, a relatively low-key investment marked a major turning point, when Swire purchased Hong Kong Bottlers Federal Inc., an American-owned business that held the franchise to bottle Coca-Cola in Hong Kong. At that time, Hong Kong Bottlers' output was 104 million bottles annually; a decade on, the company ranked amongst the top 50 Coca-Cola bottlers in the world and by 1979, Swire had dipped a toe in the Mainland Chinese market - importing the first 28,000 cases of Coke to be drunk on the Mainland since the 1950s.

By the 1970s, Taikoo Dockyard's facilities had been outgrown by the advent of large modern container ships and in 1972, Taikoo amalgamated with Hongkong & Whampoa Dockyard, to form Hongkong United Dockyards (HUD Group), which established new premises at Hong Kong's new container port. In the same year, Taikoo Sugar closed its refinery to concentrate on sugar products and packaging. These events released a vast acreage of land in the Island East area of Hong Kong and presented another opportunity for Swire. From the mid-70s, a newly formed development and management company, Swire Properties, began to create a new urban landscape in this area, beginning with Taikoo Shing, Hong Kong's first private residential estate, and the retail/office complex Cityplaza (its underground car park formed from the old Taikoo dry-dock). These were to be the first of an extensive portfolio of prestigious properties developed and managed by Swire Properties - including Pacific Place and TaiKoo Place - which helped to redefine the commercial focus of Hong Kong.

From 1st January 1974, all of Swire's Hong Kong-based interests were placed under the ownership of publicly quoted Swire Pacific Limited, a restructuring move that signalled the birth of the modern Swire group of companies, and also marked the passing of the Butterfield name, when the group's overseas headquarters were renamed John Swire & Sons, in line with the UK parent company.

The revolutionary changes of the 1970s saw many new ventures and also new locations for Swire: notably, the formation of Singapore-based offshore oil support company, Swire Pacific Offshore in 1975 and the acquisition of shareholdings in UK tea trader James Finlay and iconic Papua New Guinea trading house Steamships Trading in 1976 and 1977. By the end of the decade Swire had also established interests in the USA, where Swire Properties acquired real estate interests in Miami and Swire Pacific obtained its first US Coca-Cola bottling franchise at Salt Lake City.

The 1970s proved to be a decade of rapid expansion for Cathay Pacific, with the addition of its first long-range Boeing 707 aircraft in 1973 and its first Boeing 747-200 "jumbo jet" in 1979. In the following year, following a long battle to break the British monopoly over the route, Cathay Pacific began a non-stop service to London - becoming a truly international airline at last.

During the 1980s, John Swire & Sons substantially increased its portfolio in Australia, in 1983 acquiring 50% of Clyde Agriculture, a cotton farming business based at Bourke in north-western New South Wales, which it subsequently expanded to include wool and beef farming and made a wholly owned subsidiary in 1989. When Swire sold its agricultural interests in Australia in 2010, Clyde was one of Australia's leading pastoral companies. Swire also substantially increased its Australian cold storage interests and these developments were mirrored in the USA, where United States Cold Storage became a wholly owned subsidiary in 1982.

In Hong Kong, Swire Pacific continued to grow its trading businesses, acquiring the Marathon Sports chain in 1983 and the Reebok franchise in 1987. The group also began to reinvest in Mainland China, frequently in partnership with the China International Trust & Investment Corporation (CITIC), which became a major shareholder in Cathay Pacific in 1987. As China began to open up to Western trade once more, Swire established a new role as "local" partner to a number of leading foreign companies wishing to invest on the Mainland, and by the end of 1994 had signed joint venture agreements with ICI, Carlsberg and Tate & Lyle, establishing an important foothold in China's modern industrial sector.

Swire's soft drink manufacturing activities continued to expand on the Mainland and elsewhere and by the 1990s the group was an Anchor Bottler for The Coca-Cola Company in Greater China, as well as in the USA. In Australia, the group added to its growing expertise in road transport with the purchase in 1994 of specialist bulk haulage operator, Kalari. The 1990s also saw significant expansion of Swire's aviation interests, including the acquisition of shareholdings in regional Hong Kong airline Dragonair in 1990 and allcargo airline Air Hong Kong in 1994; while the HAECO group established new subsidiaries, Hong Kong Aero Engine Services Limited (HAESL) in 1995 and Taikoo (Xiamen) Aircraft Engineering Company (TAECO) in 1996.

A New Century

The first decade of the 21st century has seen the steady advancement of Swire's interests in Mainland China, where Swire Properties now has major interests in development projects in Guangzhou, Beijing and Shanghai, TAECO has greatly expanded its capacity and the range of services it offers at Xiamen and elsewhere, and the group's beverage and trading interests have continued to grow. In 2006 - Cathay Pacific's 60th Anniversary year - regional airline Dragonair became a wholly owned subsidiary.

Swire's interests have also spread to Africa and the Indian subcontinent with the acquisition in 2000 of a 100% shareholding in UK-headquartered James Finlay. In Australia, Swire has greatly increased its stake in the cold storage market, forming a new national entity, Swire Cold Storage, in 2004; the group has also acquired a majority shareholding in Australia's largest construction and demolition waste recycler, Alex Fraser. In Papua New Guinea, Swire is now the major shareholder in one of the country's oldest and largest commercial groups, Steamships Trading Company.

Now fast-approaching its 200th year, Swire today employs some 125,000 people worldwide in a diverse range of businesses ranging from Property and Aviation to Agribusiness & Food Chain, Marine Services and Trading & Industrial interests. Dynamic and forward-looking, Swire is proud of its heritage and the group still retains a "family" flavour with a number of members of the Swire family actively involved in the business, while the group's Honorary and Life Presidents are great-great-grandsons of the founder, John Swire of Liverpool.