Reborn as a tycoon in Hong Kong

When the confrontation between Guo Henian's funds and the short side was over, Lin Baicheng contacted Guo Henian and learned from Guo Henian the number of shares he held.

Guo Henian bought about 6 million shares at a cost price of about 40 Hong Kong dollars, spending nearly 250 million Hong Kong dollars; this time he bought more than 26.2 million shares at a cost price of less than 20 Hong Kong dollars, spending 500 million Hong Kong dollars.

In other words, Guo Henian holds 32.2 million shares, accounting for 8.05% of Hutchison Whampoa’s total shares.

Lin Baicheng began to calculate. His total holdings in Hutchison Whampoa were 199.6 million shares, of which 90 million shares were pledged to HSBC for a loan of HK$1 billion, and the stocks in his hands were 109.6 million shares.

After Hutchison Whampoa was shorted, Lin Baicheng invested US$100 million through offshore company financing to go long on Hutchison Whampoa's stock with five times leverage, buying it in two installments. I bought 41.5 million shares at one time and spent HK$995 million. Later, the price fell below HK$25 a few times and then rose rapidly, so I bought about 250,000 more shares, which cost a little more than HK$1 billion in total.

The second time, I paid all the orders at the price of HK$21. The shortfall was nearly HK$1.1 billion, and I bought 52.3 million shares after deducting the handling fee.

Adding up the two times, Lin Baicheng purchased a total of 94.05 million shares with this US$100 million leverage financing, accounting for 23.5125% of the total equity.

Adding everything together, Lin Baicheng's total share capital exceeds 70%, and is close to the full acquisition of 75% of the shares. However, he will definitely not make a full acquisition of Hutchison Whampoa, because the highest stock price of Hutchison Whampoa in the past six months is about HK$70, and he will have to spend HK$7 billion to acquire the remaining 25%. He is not that kind at all. If I have a lot of money, I won't use it to fully acquire Hutchison Whampoa.

Lin Baicheng originally held 109.6 million shares, and together with the 94.05 million shares he later bought, he held a total of 203.65 million shares, which was a little more than 50% of the total share capital.

Including the stocks held by Guo Henian, it equals a total of 235.85 million shares. These are stocks that their multi-party owners will definitely not sell, and these stocks will not flow into the stock market.

After calculating the number of shares he held, Lin Baicheng began to calculate the remaining chips that the short side might have.

Before being shorted, Hutchison Whampoa's shareholding situation was that Lin Baicheng held 49.9% of the shares, HSBC held 15% of the shares, and the remaining shares were on the stock market. Maybe some institution or large fund would buy 1% or 2% of the shares. % of stocks, but the holdings will not be too concentrated.

To go short, the short side must borrow stocks to sell, and the only stocks that the short side can borrow are from HSBC, that is, the 90 million shares pledged by Lin Baicheng and the 60 million shares held by HSBC itself, for a total of 150 million shares.

Since the short side is to make money by short selling, the short side must have sold a large number of stocks at prices above HK$37, HK$40 or even higher before the negative news broke out. In this way, the short side can Earn the difference. If you wait until negative news breaks before selling stocks short, the short side will also not make much money.

Therefore, Lin Baicheng speculated that the short side had already shorted above HK$37 before the negative news broke out, and since it was a joint effort of multiple British-owned families, it was impossible to short only 10 to 20 million shares, 30 to 40 million shares or even more. possible. Calculated based on the minimum short selling amount, it is 30 million shares.

Lin Baicheng's funds bought a total of 94.05 million shares. With such a large amount, he guessed that short sellers sold at least 70 million shares. Retail investors could sell more than 20 million shares, which is quite a lot.

Of the 32.2 million shares purchased by Guo Henian, the short side had to use 25 million shares in order to suppress the stock price. This was all considered to be less.

In total, Lin Baicheng guessed that the short side had already sold 125 million shares through securities lending, and could lend out up to 25 million more shares through securities lending. Although the short side purchased a lot of stocks from retail investors in the morning and afternoon, Lin Baicheng guessed that the number of shares purchased was between 10 million and 20 million shares. Calculating 15 million shares, the short side could sell the most shares. Just 40 million shares.

“There’s a lot to be done!”

It’s not unknown, but after calculation, Lin Baicheng found that the short side basically has no chips in hand, and Hutchison Whampoa still has 600 million Hong Kong dollars that can be used to repurchase stocks. Based on the current stock price, if the short side doesn't have as many shares as 40 million shares, it's just waiting to be blown up.

Just before three o'clock, Hutchison Whampoa's loan finally arrived, and the company's traders also completed opening accounts at the corresponding banks. The HK$600 million in funds can be entered into the stock market at any time to buy Hutchison Whampoa's shares.

However, before buying the stock, Lin Baicheng modified Hutchison Whampoa's original repurchase announcement, and then asked Hutchison Whampoa to make an announcement.

Hutchison Whampoa announced that since the company has been maliciously shorted recently, causing the stock price to plummet, the company's current operations have no problems. Therefore, for the benefit of shareholders, the company has decided to use funds to repurchase the company's shares starting from the announcement.

The upper limit of funds for this repurchase is HK$1.5 billion, of which HK$600 million is a bank loan, HK$400 million is the company's own funds, and HK$500 million is a paid loan from its friend Galaxy Games.

The maximum stock price for this repurchase is HK$30. As long as the company's stock price is lower than HK$30 per share, the company will repurchase the company's shares at any time to maintain the stock price and protect the interests of all shareholders of the company.

This is the announcement made by Hutchison Whampoa. The funding aspect is actually not too exaggerated, because the loan is real. The company’s own funds can indeed withdraw 400 million Hong Kong dollars, and Galaxy Games also has 500 million Hong Kong dollars that can be lent to Hutchison Whampoa. .

However, Hutchison Whampoa will only use HKD 600 million for repurchases at the beginning. It is best not to use its own funds and the funds from Galaxy Games Company. Its own funds have not been withdrawn for the time being, and the funds from Galaxy Games Company have not been withdrawn. to Hutchison Whampoa's account.

The reason for such an announcement is to send a signal to the outside world, boost market confidence, let more funds enter the market, and let more shareholders hold the stocks in their hands and not sell them. Only in this way will it be more likely to use the 600 million Hong Kong dollars. The funds will blow up the short side.

After Hutchison Whampoa made the announcement, traders arranged by the company on the exchange immediately began to buy Hutchison Whampoa's stock in large quantities. The stock price below 20 Hong Kong dollars was sold as much as it was sold. In less than ten minutes, the stock was sold. The stock price rose above 20 Hong Kong dollars, and then continued to buy.

The predicted short selling did not appear at all. Hutchison Whampoa's repurchase funds continued to buy stocks. At around 3:30, the stock price gradually increased to close to 25 Hong Kong dollars.

It’s not that the short side doesn’t want to smash the market, but after knowing that Hutchison Whampoa has a maximum of 1.5 billion Hong Kong dollars for repurchase, Henry Caesar and others, who hold about 4 million shares, have no desire to sell the market because of such a small amount. The market is useless at all. In this case, why should we hand over the stock at a low price? It is better to just let Hutchison Whampoa buy it.

After 3:30, many observers discovered that the short side had not smashed the market, and then they realized that this was because the short side had no chips, at least for the time being.