Media Tycoon since 1999

Chapter 362 Invest in Hengsheng and develop 51pay
Facing everyone's surprised gazes, Gao Yang said: "The contact and negotiation with Hengsheng Electronics requires a special person to be in charge. I propose that the group company add a vice president to be in charge of foreign investment affairs.

The vice president is Fang Siwen, who represents the 51 Group and is solely responsible for contacting Hengsheng Electronics. In addition, Zhou Wenbin and He Shan assist Fang Siwen in completing this task, and it must be implemented as soon as possible.

Siwen, investing in Hengsheng is very important to the future development of 51 Group. Are you willing to take on this task? "

Fang Siwen said: "President Gao, I obey the arrangement, but 51 Fortune still has a lot of work..."

Gao Yang said: "I didn't say to let you leave 51 Fortune, you are still the CEO of 51 Fortune, and 51 Fortune's event plan for next year has come out, and I will leave it to Yuan Ye to arrange and implement it."

Fang Siwen immediately said: "Okay, I will do my best to complete the task."

This matter was settled in this way. After the meeting was over, Shao Hanyun immediately went to draft the appointment notice of Fang Siwen from the board of directors.

Today, Gao Yang has undeniable prestige in the 51 Group, one is that he is the major shareholder and main founder, and the other is that everyone believes in him very much.

Gao Yang asked Fang Siwen, Zhou Wenbin and He Shan to stay and talk.

Gao Yang opened the financial report data of Hengsheng Electronics and showed Fang Siwen and the other three:

"You see, Hengsheng is a company with a high gross profit margin on product sales, but its performance has not been good in the past two years since its listing, and it has not made much money. Obviously, it has been dragged down by the bear market of A shares.

In 2004, its main business income was 2.66 million yuan, and its net profit was more than 2200 million yuan.

In the third quarterly report of this year, the main business income was only 1.4 million, and the net profit was 1400 million, of which there was a year-on-year loss in the third quarter.

A-shares have been bearish in the first three quarters of this year, and once fell below 1000 points. Hengsheng's main customers are securities firms, funds and banks. In a bear market environment, it is inevitable for its customers to reduce their expenses.

The stock price of Hengsheng Electronics is around 5.25 yuan, with a total market value of less than 5.5 million yuan, of which more than 6600 million shares are held by more than a dozen natural persons when the company was founded, and the equity is relatively scattered.

Now, it is a good time for us to get involved in this company and get some equity..."

Fang Siwen said: "Mr. Gao, we must have a corresponding premium when negotiating the equity transfer agreement with the other party. How to grasp the magnitude of this premium?"

Gao Yang thought about it: "Specifically, you should work hard to negotiate. In principle, the highest premium can be considered at about 40%, and the agreed purchase price per share should not exceed 7.5 yuan.

Our goal is to obtain at least 2000 million shares, and a maximum of 2500 million shares can be considered, so as not to let major shareholders feel that their controlling rights are threatened.

In addition, you should bear in mind the caliber of the negotiation. The 51 Group is not seeking to control this listed company, but to seek cooperation.

If we want to develop third-party online payment tools, we need to establish a strategic partnership of mutual trust with Hengsheng.

In addition, Hengsheng Electronics is now mainly engaged in 2B business. The user traffic of 51 Fortune is growing rapidly, and 51 Fund Network will be launched soon. Hengsheng Electronics can cooperate with 51 Fortune to develop 2C products in the future.

The third-party online payment tool we plan has been temporarily named [51pay]. The development of 51pay is of great strategic significance to 51 Group.

With 51pay, we can carry out online payment business on various platforms, and this one can also be the business direction of the long-term cooperation between Hengsheng Electronics and 51 Group..."

Zhou Wenbin asked: "The cost of equity in the hands of these founders should be very low, right?"

Gao Yang said: "Yes, in December 2003, Hengsheng Electronics went public at an issue price of 12 yuan. Based on today's closing price, its reinstatement price is around 15.5 yuan per share.

It seems that it has fallen by half, but for the non-tradable restricted shares in the hands of these shareholders, the rise and fall of the stock price at this stage does not make any sense.

According to the share reform plan, more than 4200 million shares will be listed and circulated in August next year, and the remaining 8 million shares will not be listed and circulated until August 2400.

The cost of the equity held by these founders is estimated to be close to zero, or even negative.

Hengsheng Electronics was founded in 1997, with a registered capital of only 200 million at that time, and increased to 1999 million in 5100, which was the total share capital before it issued shares and went public.

In recent years, the founding shareholders may have already recovered their venture capital through the annual profit distribution.

Now, the equity in their hands cannot be directly circulated in the secondary market, and someone must be willing to transfer it.

We can even negotiate to take over the 2008 million shares that will be listed and circulated in 2400.

We need to clearly express our attitude, seek strategic cooperation, and complement each other's businesses. At the same time, we are a strategic investment and will hold shares for a long time. It is no problem to hold shares for more than 5 years, and they can be written into the agreement..."

Fang Siwen said: "According to Mr. Gao's opinion, if we pay a premium of about 40% and take over the 2400 million shares that will be circulated in the next three years, the probability of success is relatively high."

Zhou Wenbin said: "That's right, starting a business and going public is just waiting for the day when it can be realized."

He Shan was surprised and said: "Brother Yang, if the highest agreed price is 7.5 yuan per share, we will take over 2400 million shares and raise 1.8 million yuan of funds."

Gao Yang smiled and said: "It's okay, we can use the loan granted by the bank to settle the funds, and after the equity is transferred and transferred, we can pledge it to a securities company or a bank, and we can get back part of the funds to repay the loan.

In short, don't worry about the funds, I will arrange to solve them, and the company will not have any financial pressure.

Now, for 51 Group, the early development of the payment tool 51pay is the top priority. With 51pay, our Internet projects can advance to the next stage.

At the same time, Hengsheng Electronics has accumulated many customers in the financial system, which will be of great benefit to 51pay's future cooperation with banking institutions. "

Fang Siwen said: "Okay, Mr. Gao, let's arrange the work at hand first, and set off to Hangzhou as soon as possible to communicate with the shareholders of Hengsheng Electronics."

Gao Yang said: "The three of you are arranged to do this matter, with Siwen as the leader, because you have a relatively better understanding of the financial service industry, and you can also clearly explain to the other party the long-term cooperation opportunities of the 51 Fortune platform.

Wenbin assisted because your communication skills are relatively strong, and you can assess the situation and make good assists during negotiations.

He Shan is a law student and provides professional assistance in this area. He Shan will immediately start collecting relevant information about this company for analysis.

In short, before you set off, you must make preparations and discuss the negotiation plan. You must be fully prepared and strive to conclude the negotiation as soon as possible..."

Fang Siwen and the others led away, Gao Yang lit a cigarette, and began to imagine the situation after he successfully invested in Hengsheng Electronics.

Now, if you take 1.8% of the company's equity at a price of 24 million, 10 years later, this investment will be worth more than 200 billion, and the return on investment will exceed 100 times. Although it is only rich on paper, from the perspective of financial investment In other words, the benefits are huge.

More importantly, 51 Group's strategic investment in Hengsheng Electronics is of great significance to the rapid development of 51pay, a third-party payment tool.

With the development of 51pay, the entire 51 Group will be completely different, and the value can be more than ten times...

(End of this chapter)