Hong Kong's new giants

Chapter 677 [Hundred Billion Profit]

Time flies, and it's mid-October in a blink of an eye.

London, Orange corporate headquarters.

The executives of Mannesmann, the second largest telecommunications company in Europe, gathered in Orange, the third largest telecommunications company in the UK, and the two sides are in the final negotiations.

It turned out that as early as more than two months ago, Orange announced its plan to sell, and immediately attracted Vodafone, the largest telecommunications company in Europe, and Mannesmann, the second largest telecommunications company in Europe. scramble.But now, Mannesmann is of course the one with the highest sincerity, and the two sides have reached the end of the negotiation.

Orange Company was originally a subsidiary of Times Communications, and later merged with the European business of 'Hutchison Communications', forming a situation where two Hong Kong-owned companies operate the third largest telecommunications company in the UK, led by Huo Jianning and assisted by Yuan Tianfan.

There is no way, if the two Hong Kong-owned telecommunications companies continue to compete in the UK, it will cause adverse effects and will invest more.Currently, Times Communications holds a 27% stake in Orange, and Hutchison Communications holds a 24% stake.

The reason why the two companies decided to sell Orange was also the result of discussion between Lin Zuhui and Li Chaoren:
They believe that there are three phenomena in the telecommunications industry: 1. Voice services are becoming more and more popular. Although the growth rate is very fast, the competition in the industry is too great, which may reduce the marginal profit; 2. The proportion of data transmission services is increasing, and the growth rate The percentage of speed is much higher than that of voice; 3. Driven by the upsurge of technology and communication stocks, the market value of mobile communication companies has reached its peak. "

Another huge pressure is that although Orange is the third largest company in the UK, it can only be the third largest. The fierce competition has made the company's life more and more difficult, and the competition is getting worse. fierce.

The top two telecommunications giants in Europe, British Vodafone (Vodafone) and German Mannesmann (Mannesmann), have both regarded the British market as a must-see and are fighting for the leading position.

The New Era Group and the Cheung Kong Group received about 800 billion Hong Kong dollars each, and the New Era Group received slightly more.

Neither is in a hurry, but Vodafone and Mannesmann are, especially Mannesmann.

Mannesmann's executives communicated immediately, and they were already very excited that a difference of 0.3% could determine who is the largest telecommunications company in Europe.

Not optimistic, even in a crisis situation.

In fact, it is not yet the final profit figure, because Mannesmann's stock will continue to rise within this year; and next year Vodafone can't swallow that breath and directly annex Mannesmann, then the stocks in the hands of the two Hong Kong consortiums will be It will become more than 5% of the shares of the new company, and the face value will increase by tens of billions (estimated to be 500 billion).

Lin Zuhui returned to the office of New Times Group, and at noon he had a banquet with Li Chaoren to discuss the sale of Orange Company.

In this way, the two consortiums, Times Communications and Hutchison Communications, sold 51% of Orange in their hands at a price of about 1100 billion Hong Kong dollars.

10 month 20 day.

If it can inspire two bids for Orange, it will definitely sell for a good price. This happened more than two months ago-Orange made a publicity about its intention to sell.

Overseas always think of HSBC when mentioning Heung Kong Enterprises; however, in the two years from 1997 to 1988, HSBC only had an annual profit of 430 billion and 310 billion respectively, which is far from that of New Era Group.

Historically, Li Chaoren has made a big splash this year, because the Cheung Kong Group under his leadership has made a profit of more than 1500 billion, shocking the world.

And the so-called cases where the boss and the second child fight, and finally kill the third child, are also not uncommon in business wars throughout the ages.

In 1998, the net profit of New Era Group was 760 billion Hong Kong dollars (460 billion Hong Kong dollars from the sale of European and American bank stocks, plus normal profits)
In the past two years, New Era Group has achieved good results that 'shocked the world' in the business community.

Today, the market value has exceeded 7500 billion yuan, and trillion yuan within the year is not a problem.

"President Fussell, we have accepted the conditions of 35 billion US dollars in cash and 28 billion US dollars of three-year euro floating rate notes issued by your company; but considering the number of users and growth rate of Orange, we still need 10.5 % of Mannesmann shares. If you agree, we can sign the contract today. I can remind you that soon Vodafone will also accept such conditions”

But in this life, the New Era Group has already shocked the world:

After a long time, Fussell stretched out his right hand across the conference table, and said with a smile, "OK, congratulations on reaching an agreement."

In 1997, the net profit of New Era Group was 750 billion Hong Kong dollars (sales of buildings, shopping malls, etc., and profits from short selling gold, plus normal profits);

Huo Jianning is worthy of being a good negotiator, and quickly adjusted the interest of Mannesmann's top management to a high level, making the negotiation go smoothly.

Therefore, in fact, this transaction will obtain more than 1600 billion profits.

Lin Zuhui of New Times Group and Li Chaoren of Cheung Kong Industrial announced at the same time that the two companies have formed a consortium and have decided to sell a total of 51.01% of the shares they hold in Orange to Mannesmann. The total transaction price includes: equivalent to Hong Kong dollars 265 billion in cash, three-year euro floating rate notes issued by Mannesmann equivalent to HK$215 billion, and 10.5% of Mannesmann's shares.

It can be seen that Li Chaoren is very excited to reap a profit of about 500 billion Hong Kong dollars.

When the news came out, the global capital market was fried.

Lin Zuhui did some calculations. This year, New Era Group's conservative annual profit is more than 1500 billion yuan, which is double that of the previous year.

Lin Zuhui smiled in his heart: "You could have made more than 1000 billion in profits this year, but I cut it off!"

However, it is a 'crisis', but also a 'turning point' - Orange company has the disadvantages of being the third company, but also has the unique value of being the third company - Vodafone and Mannesmann, whoever can buy Orange company can become real boss.

Therefore, New Times Group has been the largest enterprise in Hong Kong since 1997.

Because the sale of Orange is calculated as a profit of 600 billion, the normal net profit is about 350 billion, plus the profit of 600 billion Hong Kong dollars from the sale of Microsoft.

Orange's investment is only on the scale of tens of billions, and it has recovered a considerable amount of principal through listing.This means that in this transaction, the two consortiums of Xiangjiang obtained a net profit of more than [-] billion Hong Kong dollars.

Huo Jianning is right, this condition will make Vodafone agree quickly, and then the two parties will fall into competition again.However, there has been news from the two bigwigs in Xiangjiang that it is best to reach a deal in October.

The two consortiums are a joint consortium, so the follow-up sharing and cash-out issues are all consistent.

Obviously, both Lin Zuhui and Li Chaoren saw the crisis.

Cash plus floating-rate notes is a total of 480 billion Hong Kong dollars, and Mannesmann was only willing to add 10.2% of the shares (currently worth about 580 billion Hong Kong dollars).

By the turn of the millennium, New Era Group also has shares held by Vodafone (purchased in the secondary market) and Sony, and is expected to cash out nearly 500 billion Hong Kong dollars; plus Vodafone's acquisition of Mannesmann's profit of 250 billion (subsequent gains) profit), and a normal net profit of more than 350 billion; New Era Group will continue to create miracles in the millennium.

Even in 2001, although New Times Group returned to "normal profitability", it still started to grow from HK$400 billion, and it will not show a downward trend.After all, the real estate, hotel, shipping, beverage and food industries invested in these years will gradually explode after the millennium.

The problem that New Era Group is facing now is: there is nowhere to spend the money.

Of course, it is only a short-term confusion. Lin Zuhui still has some investment directions in his mind, but he needs to figure it out gradually.

(End of this chapter)