Reborn Tycoon Rise

September 12, 1979, midnight:

Cheung Kong Holdings and HSBC announced to the media at the same time: Cheung Kong Holdings has reached an agreement with HSBC. At a price of HK$7.6 per share, Cheung Kong Holdings will acquire all 90 million Hutchison Whampoa ordinary shares held by HSBC, accounting for approximately With 22.4% of all issued shares of Whampoa, Cheung Kong Holdings will become Hutchison Whampoa's largest shareholder.

According to the agreement, the total transaction value is HK$684 million. Cheung Kong Holdings must immediately pay 20% of the total price of HK$684 million, and the remainder must be paid within the remaining two years!

As soon as the news came out, it shocked the whole Hong Kong!

Although Hutchison Huangpu has been languishing since the 1973 stock market crash, the lean camel is bigger than the horse, and its core high-quality assets still have many, such as the 24-storey Hutchison Building at its Central headquarters, Hung Hom Cross-Harbour Tunnel, Watsons, Parknshop Supermarket, Hilton hotel properties in Central, more than 2 million square feet of land on the Hung Hom beachfront, etc...

The next day, the headlines of every newspaper in Hong Kong put Li Jiacheng's photo on the front page. This was the first Chinese to acquire the four major foreign companies in Hong Kong in so many years. At this moment, Li Jiacheng's limelight surpassed everyone else.

Many economic commentators also published various comments, describing the move as "a snake swallowing an elephant", "groundbreaking", and "like dropping a bomb." The political and economic commentary of the Economic Times pointed out: This transaction is a major victory for the Chinese. Mr. Li Jiacheng is not only a strongman in the real estate industry, but also a hot figure in the stock market!

However, Li Jiacheng's good deeds are simply a nightmare for the current head of Hutchison Whampoa, Wei Li. In the past few years, he has worked hard to manage Hutchison Whampoa. Although he has not completely brought Hutchison Whampoa back to its former peak, the company has It had turned a profit, and just when he was about to sit back and watch Hong Kong like Jardine's Niubijian, HSBC changed hands and sold Hutchison Whampoa.

Wei Li lashed out at Shen Bi in the newspaper, believing that Hutchison Whampoa's company stock value and net assets should be HK$14.4. However, HSBC Shen Bi's answer was simple:

"The valuation of HK$14.4 refers to the company's net asset value. If 90 million shares are sold at this price, no buyer can be found at all, not to mention that before the transaction, the average market value of Hutchison Whampoa's share price was HK$5.8, and Cheung Kong Holdings was trading at 7.6 The Hong Kong dollar acquisition is already at a 30% premium..."

In fact, although Li Jiacheng paid a 30% premium to acquire Hutchison Whampoa, the 20% down payment was actually approved by HSBC as a loan to Cheung Kong Holdings the previous day. Comrade Li got the entire Hutchison Whampoa without spending a penny!

Even though Wei Li was so angry that he almost vomited blood, there was nothing he could do about it!

"It's so cool! I offered to buy Hutchison Whampoa shares at a premium of 50%, but Shen Bi refused without thinking. Li Jiacheng got Hutchison Whampoa without spending a penny. It's so annoying that people are comparing themselves to each other. !" Xu Zhi said with a sigh after reading all the newspaper articles about Li Jiacheng's acquisition of Hutchison Whampoa in the past two days.

Wang Liming smiled and said: "There must be a lot of secret transactions between them, otherwise they wouldn't even give us the opportunity to ask for prices!"

Under normal circumstances, when selling the same asset, sellers would like countless people to come and compete, so that they can raise the price and obtain the highest profit. However, Shen Bi directly rejected Xu Zhi's request at the beginning, and instead secretly sold it to Li Jiacheng at a low price. , there must be a lot of trouble here.

In later generations, countless well-known economists analyzed Shen Bi's move for many reasons, such as:

Hutchison Taipan Weili has repeatedly attempted to expand shares and raise funds in order to dilute the shares owned by HSBC. At the same time, due to the rebound in Hutchison Whampoa's performance, Wei Li also became arrogant and began to regard Hutchison as his own, placing all the credit for saving Hutchison on himself.

Li Jiacheng once gave Shen Bi face and gave up the acquisition of Wharf. At the same time, shipping king Bao Yugang was also a director of HSBC and he also came forward to help Li Jiacheng.

But the main recognized reason is that the mainland began to establish diplomatic relations with Europe and the United States in the early 1970s. Especially in 1971, when the mainland returned to the United Nations, only one small country in Europe voted against it.

How could a member of the five permanent members of the United Nations allow another country's colony to remain on its territory?

Portugal has long given up on treatment, and Great Britain values ​​​​face more, so naturally it is not willing to give up casually, but Britain's national power is no longer there, so as long as it has face, that's pretty much it!

In 1976, the mainland began to develop its economy in an all-round way. HSBC, with its keen sense of smell, already knew that the return of Hong Kong was inevitable, so a certificate of investment was a must.

Comrade Lao Li is the best candidate. In 1978, he went to the mainland to attend the 29th anniversary celebration and was personally received by central leaders. In 1979, he was elected as a director of CITIC Group. His status was already obvious!

HSBC naturally wanted to make friends with Lao Li, so the Hutchison Whampoa deal came about.

At the same time, from a commercial perspective, Li Jiacheng's main business is real estate, and real estate in Hong Kong will never be separated from HSBC. As long as Li Jiacheng is cultivated into a new giant, it will also be convenient for HSBC to continue to control the economic lifeline of Hong Kong!

Xu Zhi asked: "Have all the funds from oil futures come back?"

Wang Liming replied: "They are all back. The cost of US$100 million has been returned to Midea. With 5 times leverage, we have made almost US$470 million. However, after deducting financing interest and taxes, we still have a total of US$380 million on hand!"

Xu Zhi nodded: "Yes, what about the stocks of Hutchison Whampoa and Cheung Kong Holdings? How are the acquisitions going?"

Wang Liming said: "Currently, we already hold 18.3% of Hutchison Whampoa's stocks, and Cheung Kong Holdings is a little lower, only 14.1%. This is because the stocks of Hutchison Whampoa and Yangtze River have fluctuated too much in the past few days. I took the opportunity to fish in troubled waters. Although the purchase price was higher than before, they also forcibly acquired almost 2% of the stock."

"This is not a problem!" Xu Zhidao said: "Now we can acquire as much as we can. Once we announce the information, it is estimated that the stock price will skyrocket immediately!"

Wang Liming asked: "Can we announce it later? During this period, the stocks of Hutchison Whampoa and Cheung Kong Holdings are very popular. We can take the opportunity to acquire large quantities. In just 10 days, I am sure that we can reach the level held by Li Jiacheng." Hutchison share.”

"No need." Xu Zhi refused: "Later deployment can indeed save acquisition costs, but our purpose is not investment, but acquisition. Li Jiacheng can also do the same when we acquire at low prices. Tomorrow morning Announce the acquisition!”

Wang Liming nodded: "Now Hutchison Whampoa's share price is HK$7, what is our acquisition price?"

Historically, when Li Jiacheng acquired Hutchison Whampoa shares from HSBC, the stock price was HK$5.5. After the acquisition, it increased slightly. However, in this life, Evergrande has been secretly acquiring Hutchison Whampoa shares. By the time of Li Jiacheng's acquisition, the stock price was also much higher, reaching HK$5.8. .

Because Chinese capital has entered Hutchison Whampoa for the first time, and Li Jiacheng’s Cheung Kong Holdings has also announced a lot of business cooperation information, Hutchison Whampoa’s share price has reached close to HK$7.

Xu Zhi smiled and said: "If you want to play, let's play big. Tomorrow our purchase price will be HK$10 per share!"

"10 Hong Kong dollars, so big?" Wang Liming was also shocked. According to the current share price of Hutchison Whampoa, this is almost an increase of more than 40%. Acquisitions of this magnitude are rare.

"Yes, 10 Hong Kong dollars per share." Xu Zhi confirmed: "Cut the knot with a quick knife, I have no interest in dragging it out any longer."

If compared with funds, Li Jiacheng is naturally inferior to himself, but there is HSBC behind him. Xu Zhi knows very well that it is difficult for him to fight against the central bank of Hong Kong. Only rapid acquisition at a high premium is the best choice. !

Anyone who knows this period of history may have seen news reports that HSBC sold Hutchison Whampoa shares to Li Jiacheng at a discount. However, I checked several formal information and confirmed that Li Jiacheng purchased Hutchison Whampoa shares at a premium of 30%. The so-called Cheung Kong's market value of 600 million annexed Hutchison Whampoa's market value of 6.2 billion. The former's market value of Cheung Kong Industries' 600 million is correct, but the latter 6.2 billion refers to Hutchison's total assets, not market value.

Reference materials: History of Hong Kong business mergers and acquisitions, biography of Shen Bi