Year: I had a good time when I was young

Chapter 815: Small Wins Big, Turning the Table

Since Chu Xiangqian didn't want to fall out with the Jockey Club, nor did he want the good relationship among his friends to be damaged, he naturally wouldn't fall out with Bridge just for the sake of face.

Of course, since Bridge wanted to hold the Jockey Club's own auction this time due to pressure from other directors of the Jockey Club, and it seemed like he was forcing himself, Chu Xiangqian would naturally not let it go easily.

After thinking it over, he looked at Bridge and said, "Let's set up the Hong Kong Island Horse Auction Company together. I will own 7% of the shares, and all the proceeds from the auction of the horses under my name will belong to me or the Kowloon Racecourse.

The rest is the company’s profit.”

Bridge was suddenly in a dilemma. Logically speaking, it was normal for Chu Xiangqian to be unwilling to share the profits after the auction of his horse.

They had successfully held a special auction at the Kowloon Racecourse last year, and they had a supply of Arabian horses, so their ability in identifying horses was unique.

No one is willing to share the profits from a unique business.

As for the commission income from the auction of other horses, everyone still got 7-3 points, and Bridge didn't think there was a problem.

The other directors of the Jockey Club forced him to persuade Chu Xiangqian simply because they were jealous of the total amount of money raised from the horse auction organized by Chu Xiangqian.

Last year, it exceeded 8 million US dollars to reach 8190 million US dollars, if it was based on the 5% commission agreed upon with Chu Xiangqian.

The Jockey Club got $410 million for free.

Although this money cannot go directly into the pockets of the Jockey Club directors, some directors have hinted before that everyone can set up a company to take over the business of the auction venue and all matters related to the auction.

At that time, we will have to pay the Jockey Club at most 200,000 or 300,000 Hong Kong dollars as the cost of renting the Jockey Club's auction venue.

The resale profit can be at least 400 million US dollars, about to million Hong Kong dollars.

This money was like finding it for free, even Bridge himself was tempted.

But he was still rational and knew that he had many opportunities to make money following Chu Xiangqian.

The coal business alone can bring in millions of dollars every year.

There is really no need to offend Chu Xiangqian for the sake of those directors.

So even though it was just said that the Jockey Club might hold its own horse auction, the tone was very timid.

His expression was also conflicted, which was why he didn't anger Chu Xiangqian.

Bridge suggested to Chu Xiangqian that they jointly set up an auction company. After just a moment's thought, he decided to side with Chu Xiangqian.

As for the other boards of the Jockey Club, if they don’t agree, I will just ignore it.

If you have the ability, go and persuade Chu Xiangqian yourselves. As for forcing Chu Xiangqian, I believe no one is so stupid.

The identity of a foreigner cannot suppress Chu Xiangqian.

Moreover, Chu Xiangqian was a lifelong noble, so when the foreign directors of the Jockey Club saw him, they had to bow and call him SIR first.

So if they really compete with Chu Xiangqian, anyone with a clear mind will know that there is a high probability that they will not be able to compete with him.

In addition, Chu Xiangqian already has two England-Women Triple Crown winners and one Magnesium-American Triple Crown winner.

There were also two champions from Hong Kong Island, one was a champion knight, and the other was a Ferghana horse that Lei Luo bought from Chu Xiangqian.

Moreover, among the horses auctioned in recent years, there are also horses that have won championships in second-level competitions in Southeast Asia.

As for those that made it into the top five, there were even more. Sakura had a thoroughbred horse that came in second for two consecutive years.

I heard that the horse owner not only didn't think there was something wrong with his horse, but also kept blaming the trainer and rider.

First of all, horse racing results are indeed related to the condition of the horse.

The rider's condition, experience and skills can also affect the results.

Secondly, if it were Chu Xiangqian, he would not admit that his horse was not good enough.

Once you give in, the loss may be hundreds of thousands or even millions of dollars.

Even if this kind of horse has not won the championship, it is already considered a top-quality horse as a stallion.

In addition, when Margaret won the Olympic gold medal in 60, the horse she used was also provided by Chu Xiangqian.

This matter has long been no secret in the circle, even in the English aristocratic circle.

Chu Xiangqian’s series of achievements makes people despair just thinking about it.

It also proves that Chu Xiangqian has an unparalleled eye for horses.

Bridge had no confidence if he was determined to compete with the auction held by the Jockey Club.

Now that Chu Xiangqian has taken a step back, Bridge knows very well that if he still doesn't know how to advance and retreat, he will definitely be kicked out of the poker club in the future.

So Bridge has now made up his mind that if he returns, he will ask all the other directors of the Jockey Club to compromise as well.

"Mr. Chu, let's do as you say. If other directors still don't agree, I will persuade a few directors who are like me and support you to suppress the opinions of those people at the board meeting."

Chu Xiangqian's impression of Bridge improved a lot.

After seeing off Bridge, as well as Hader and Nelson who had repeatedly stated that they would stand on his side, Chu Xiangqian stood at the door and pondered silently for a while.

Not only will it ensure that the new company will not affect its own interests, it will also indirectly bring the influence of the Jockey Club to its own benefit and avoid any foul play within the Jockey Club.

Then he smiled again and went back to the living room.

To be honest, Chu Xiangqian didn't really want to fall out with the Jockey Club.

Even though Chu Xiangqian is rich and well-connected, the Jockey Club has a huge influence in Hong Kong Island. There is a way to achieve a win-win situation. Only a fool would really make enemies with the Jockey Club.

Of course, although Chu Xiangqian talked about a win-win situation, he actually gained more.

But it also leaves the Jockey Club with a chance to reap the benefits. Given the current situation, the probability of the Jockey Club agreeing is very high.

After all, the current Jockey Club is not the Jockey Club of thirty or forty years later, where the annual amount of betting on horse racing can exceed 300 billion.

Relying on gambling and other income, the company can achieve revenue of 70 to 80 billion yuan and a net profit of several billion yuan.

The profit may seem not high, but the funds controlled by the Jockey Club have hundreds of billions of funds.

Moreover, there are 2.5 employees who make their living from the Jockey Club, and the number of related practitioners adds up to more than 40.

If we include related practitioners outside Hong Kong Island, there will be even more.

This is why Chu Xiangqian and other Hong Kong tycoons are always cautious when facing the Jockey Club.

No matter how rich you are, your 2.5 employees and 40 practitioners cannot make a penny from you, so they will naturally stand on the side of the Jockey Club.

Given the massive amount of money controlled by the fund, no one in their right mind could go against the Jockey Club.

Of course, the Jockey Club at that time had not yet expanded to that scale.

Chu Xiangqian became furious and decided that he was determined to join the Jockey Club's board of directors this time.

In the future, if we can go inside the enemy and fight one horse at a time, we will always have a chance to secretly control the Jockey Club.

Then Chu Xiangqian had an idea. Among his friends and business partners, Ho Chan-yuen, the executive director of Hang Seng Board of Directors, was definitely qualified to become a director of the Jockey Club.

Thinking of this, Chu Xiangqian picked up the phone and asked He Zanyuan to have dinner together after the Hang Seng board meeting on the sixth day of the first lunar month.

He Zanyuan agreed immediately, but he mistakenly thought Chu Xiangqian wanted to discuss the issue of shares. Since 61, Chu Xiangqian has been looking for He Zanyuan and He Zanyuan's elder brother to buy gold every year.

The purchase was not much, only 2 tons a year. In three years, the He family alone bought 6 tons.

In addition to the gold crisis that year, all the profits earned from gold futures were converted into gold.

Most of them are stored in the Novice Village warehouse, and some are stored in Standard Chartered and Hang Seng.

Among them, Hang Seng had 2.5 tons, and after the first horse racing auction, Chu Xiangqian bought another 4 tons of gold and placed it in Hang Seng.

In total, I saved 12.5 million tons of gold in Hengsheng.

This batch of gold will of course generate interest, but Chu Xiangqian was willing to deposit the gold in Hang Seng, and one of the conditions was that the interest generated by the gold would be converted into Hang Seng shares every year.

It was a pity that Hang Seng only agreed to sign a five-year contract. Otherwise, Chu Xiangqian could have just kept the gold in Hang Seng, and after ten or twenty years, he could have swallowed up most of Hang Seng's shares with the interest generated by the gold.

But this contract not only made Chu Xiangqian no loss, but also made him a huge profit.

After three years, Chu Xiangqian's shares have increased from the original 5% to 18.5%.

In 61, gold was $35 per ounce, and one ton of gold was only $123.8 million.

At that time, Chu Xiangqian had only 6.5 tons of gold deposited in Hang Seng, so the 6% interest only brought him 48 US dollars.

At that time, the exchange rate of Hong Kong dollar to US dollar was also 4 to 1, which was equivalent to more than 190 million Hong Kong dollars.

Considering that Hang Seng’s market value was only over 4 million at the time, it exchanged for 4.75% of the shares.

At that time, Hang Seng’s shareholders felt that this was more profitable than buying and selling.

Relying on these 6.5 tons of gold reserves, the bank attracted more than 2 million Hong Kong dollars in deposits that year.

By 62, Chu Xiangqian's gold had increased to 12.5 tons, and Hang Seng Bank once again absorbed a large amount of deposits from depositors.

At the end of that year, total deposits exceeded HK$5 million.

In addition, the real estate market soared for two years. The interest generated each year by the money Hang Seng lent, after deducting the interest paid to depositors, made a profit of at least 20 to 30 million.

The market value has been rising year after year.

If I were not afraid to lend out all the money, the interest generated from 5 million would be 6 to 9 million.

But what Hang Seng’s shareholders did not expect was that gold prices have also been rising in the past two years.

Although Chu Xiangqian only got 62% of the shares in 4, gold soared to US$51 per ounce last year.

The 12.5 tons of gold alone are worth $2250 million.

The interest rate of 6% is 135 million US dollars, and at the exchange rate of 4.45, this money is worth 600 million Hong Kong dollars.

Considering that Hang Seng’s market value peaked at HK$1.2 million last year, Chu Xiangqian would have to hold 5% of the shares.

He Zanyuan got a headache just thinking about the fact that there were still two years left in the five-year contract and he would most likely have to give Chu Xiangqian at least 5% of the shares.

Moreover, it was he who strongly advocated for this matter in the first place. Firstly, Hang Seng was still a small player at that time, and it was common for it to win over wealthy people.

Unfortunately, there are not many wealthy people who are as optimistic about Hang Seng as Chu Xiangqian.

In addition, seeing that Chu Xiangqian promised to buy 2 tons of gold from himself and his eldest brother every year, it would be better to keep the gold in Hang Seng Bank instead of keeping it in Standard Chartered.

Moreover, the 6% annual interest rate that Chu Xiangqian requested was a bargain for Hang Seng considering that the interest rates for loans at that time were often over 10% or even 15%.

Therefore, Chu Xiangqian proposed that the interest generated each year should be automatically converted into Hang Seng shares at the end of the year. Under the lobbying of He Zanyuan, the board of directors signed a five-year contract with a large majority of approval without much debate.

But after three years, Chu Xiangqian's shares have grown from 5% at the beginning, which was just enough to enter the board of directors and have one vote, to the second largest shareholder now, which has made many shareholders begin to regret.

If he continues like this for another two years, Chu Xiangqian will automatically become the largest shareholder, just in case this guy makes a large acquisition on the stock market.

With his financial resources, he can easily increase his holdings to 34%, a number of shares that gives him a veto power.

In case of a crisis in the future, it is not impossible to buy at a low price and acquire more than 51% of the shares.

Chu Xiangqian wanted to have absolute control over the bank, but the nature of a bank is somewhat different from that of other companies.

Chu Xiangqian knew without even thinking that in the previous life, the market value of Hang Seng exceeded two or three hundred billion Hong Kong dollars, and the support of HSBC was definitely indispensable.

When the bank run crisis occurred in Hong Kong the next year, HSBC took the opportunity to acquire 6% of Hang Seng's shares and took absolute control.

Otherwise, with so many banks founded by local wealthy businessmen in Hong Kong Island, why did Hang Seng's market value soar and become the second largest bank in Hong Kong Island?
Therefore, Chu Xiangqian will definitely increase his holdings in Hang Seng, but controlling rights are no longer his goal.

Otherwise, relying on its own funds, Hang Seng could easily survive a bank run, but it would be basically impossible for it to develop into a financial giant.

Chu Xiangqian not only wanted to bring HSBC in, but also Standard Chartered.

The two note-issuing banks have become shareholders of Hang Seng at the same time, and their shares cannot be small, so that everyone can make fortune together in the future.

Together they are trying to squeeze out the market and profits of small and medium-sized banks founded by locals.

As for joining forces with the foreigners to suppress local bank capital, Chu Xiangqian did it without any psychological burden.

Firstly, he knew that in the future all local banks in Hong Kong Island would be small players, and without him joining, they would still be no match for the foreigners.

Secondly, when the locals cheat their own people, they are often more brutal and have no bottom line than the foreigners.

At its peak, there were more than 8 banks in Hong Kong Island, and they used every possible means to attract deposits.

Unfortunately, not everyone can bear the financial pressure brought by high interest rates.

When the economic situation is good, everyone lives in peace. But once the economy goes into a downturn, you hear about banks going bankrupt or bosses running away every now and then.

I don’t know how many citizens have been cheated.

Of course, there are many conscientious entrepreneurs in Hong Kong, but the pursuit of profit is an unsolvable fact.

People like Chu Xiangqian have a bottom line, but in the capital market, they are sometimes also crocodiles.

It can eat people.

Fortunately, he is not interested in the hard-earned money of the lower class, but don’t think that he is so noble. This is because he does not need to suck the blood of the lower class.

He wanted to bring Ho Chan-yuen to the board of directors after he became the new director of the Jockey Club. This was not only because Ho Chan-yuen had the most experience, but also because they had worked together very happily over the past few years.

But in the eyes of Ho Zanyuan and his elder brother, Chu Xiangqian was trying to win over the Ho family, the founding family of Hang Seng, in order to ensure the smooth execution of the contract for five years when the contract was about to enter its fourth year.

Although He Zanyuan now only owns 4.7% of the shares, his eldest brother owns 6.4%, and his cousin He Wenli, the buyer of the first tiger skin when Chu Xiangqian first came to Hong Kong Island, holds 11.3% of Hang Seng's shares.

The combined shares of the three uncles and nephews amount to 22.4%.

As long as Chu Xiangqian gets the support of the He family and wins over a few small shareholders, his shareholding will exceed 51%.

Therefore, in the eyes of the He Zanyuan brothers, Chu Xiangqian's pushing He Zanyuan to join the Jockey Club's board of directors was nothing more than a gesture of goodwill and deepening of relations.

But for the He family, this is also of great benefit to them.

You'd be a fool not to agree.

(End of this chapter)