Hong Kong: Starting with 10 billion

Chapter 79 Cucumber: Have you forgotten the original agreement?

There are too many companies in the world that face major crises due to a small fluctuation in the external environment.
For example, Hutchison.

In March 1973, Hong Kong's economy suffered a stock market collapse due to the impact of the first oil crisis.

In 1975, a major project invested by Hutchison Whampoa in Indonesia was defaulted by the local government.

The funds are facing difficulties in turnover and are on the verge of bankruptcy.

In September 1975, Hutchison Whampoa held a shareholders' meeting and the board of directors was forced to accept the acquisition by HSBC.
HSBC invested HK$1.5 million to acquire 9000 million shares of Hutchison Whampoa, accounting for 33.65% of the issued shares.

HSBC then became Hutchison Whampoa's largest shareholder.

In other words, HSBC basically took control of this British giant at a price of HK$1.67 per share.

However, fortunately, HSBC is a bank and has no intention of acquiring a company to run it itself.

Shen Bi knew very well that Fang Hexuan had already become powerful, and it would be best to cooperate with such a person.

Even considering the continued rise in gold prices, he should cooperate.

HSBC followed Fang Hexuan and bought 20 billion gold futures. Even if there was a wrong decision last time,
So far, the bank has been making huge profits.

Shen Bigang has only been in charge of the company for a few years. If he can bring unexpected returns to shareholders, his position will only become more secure.

The current situation is that Pao Yue-kong hopes that HSBC will divide all of its 9000 million common shares into two parts and sell them to Li Ka-shing and Fong Hok-hin.

In this way, it can be regarded as repaying Li Ka-shing's favor.

In addition, it also indirectly enhanced the strength of the Ningbo consortium.

Out of respect for HSBC's largest individual shareholder and also for the sake of money, Shen Bi was inclined to cooperate in both transactions.

After half a month of negotiations, HSBC finally agreed to sell 6.8 million Hutchison shares to Fang Hexuan at HK$5000 per share, accounting for 12.44% of Hutchison's current total share capital.

According to Hong Kong practice, the amount of this transaction can be paid in installments over a certain period of time.

However, the money Fang Hexuan used to buy Hutchison Whampoa shares was still borrowed from HSBC.

In other words, HSBC's profit from selling stocks is simply transferred from the left hand to the right hand.

However, they are very willing to lend the money now.

Even if we don't give face to the jazz, we have to give face to gold.

Shen Bi used surprise attacks to
Bypassing the opinions of the three company representatives on the board of directors, namely Jardine Matheson, Swire and Hutchison Whampoa,
Signed the final acquisition contract directly with Wanda.

Such a large equity transaction must be disclosed to the outside world according to the Securities Exchange Act.

In an instant, the whole of Hong Kong was shocked!

In recent years, there have been many examples of Chinese acquiring British assets.
Previously, Cheng Yu-tung of New World acquired Blue Chimney.

Later, Li Ka-shing took over Qingzhou Cement.
In recent years, there have been rumors that both Li Ka-shing and Pao Yue-kong wanted to get involved in Hutchison Whampoa.

These vivid cases all show Hong Kong people that Chinese capital is slowly rising.

From now on, British capital will no longer have the final say in Hong Kong.

But now, HSBC has taken the initiative to announce that Wanda has completed the acquisition of 12.44% of Hutchison Whampoa shares.
How can this not be shocking and exciting.

Hutchison Whampoa is one of the four largest foreign companies in Hong Kong.

If Chinese capital could acquire it, it would be of great historical significance.

Wanda is still a long way from completely controlling Hutchison.
Fang Hexuan didn't care about the outside world's disturbance and continued to acquire Hutchison's shares.

But the management of Hutchison Whampoa reacted very strongly.

They fiercely criticized HSBC and Wanda, saying that they were carrying out a sneak attack behind Hutchison's back.

Hutchison Whampoa management also accused HSBC of selling its shares at a low price.

Calculated at HK$6.8, Hutchison’s total market value is only HK$27.4 billion.
But the large piece of land owned by Hung Hom, which later became Whampoa Garden, was worth 2.7 to 2.8 billion.

They also believe that after evaluation, the net value of Hutchison's assets is HK$56 billion, which means the market value of each share is at least HK$13.8.

The price was twice as high as the one HSBC paid to Wanda. Hutchison Whampoa's chairman and CEO Weeley directly and unceremoniously mocked HSBC and Stephen Simpson.

They believe that they are sacrificing Hutchison’s interests to flatter and lick the Chinese.

This made Shen Bi very sick.

HSBC responded immediately:

"The HSBC board does not object to the valuation of the net assets of the company as proposed by Hutchison Whampoa management."

"However, if HSBC sells 13.8 million ordinary shares at HK$5000, it will be difficult for a long time to find a buyer."

"The current price of HK$6.8 per share was calculated after half a month of consultations between HSBC and Wanda, based on Hutchison Whampoa's recent average market value of HK$5.1 per share plus %."

HSBC has well-founded and blatantly slapped Hutchison’s management in the face.

Damn, you still have the nerve to refute? Look at what you bunch of losers have done to such a big company?
5.1 Hong Kong dollars, only one-third of DreamWorks Entertainment's 15.37 Hong Kong dollars.

Four years ago, HSBC acquired 9000 million ordinary shares of Hutchison Whampoa on the orders of the Hong Kong government.

The purpose, of course, is to save this British company and avoid bankruptcy.

Hutchison Whampoa has invested a large amount of the company's profits overseas, but has not made any money yet.

As for the assets in Hong Kong, they are managed conservatively and passively.

It would be strange if the stock price could go so high!

HSBC has always hated Hutchison for not living up to expectations and playing a good hand badly.

In addition, HSBC is selling Hutchison Whampoa's shares at this time to prepare for its international deployment.

At present, it is not only Chinese companies that are eyeing Hutchison Whampoa.

Jardine Matheson, Swire and even some American companies wanted to acquire Hutchison Whampoa.
But the HSBC board of directors and management such as Stephen Schmidt are very politically savvy.

The reform and opening up of the mainland, the Chinese and American chili peppers, and the Governor of Hong Kong's visit to the north, these political signals are actually very obvious.

The current political environment no longer allows British capital to continue to control all of Hong Kong's commercial resources.

It is necessary for the Hong Kong government to relax its suppression of Chinese capital.

This is the main reason why HSBC decided to sell part of its shares in Hutchison Whampoa to the Chinese.

Of course, HSBC is also happy to see the Chinese fighting among themselves.
The 9000 million shares were divided into two and sold to two Chinese companies.

This is consistent with the British style of being troublemakers.

However, our Mr. Li Ka-shing is not in a very good mood at this moment!
He even wanted to call Pao Yue-Kong to question him - "Didn't we agree on this before?"

But what really shocked him was the sudden appearance of Fang Hexuan and Wanda Real Estate.

"This person has never done anything big before!"

"Wait, why do I feel like there's a conspiracy here?"

"Why am I the last one to know?"

"."

Li Ka-shing locked himself in his office and thought for the entire afternoon.

He finally came to his senses.

"Could it be this person who first leaked the news that I was buying Wharf Holdings' shares?"

"Why can he detect my movements?"

"Who is he?"

Li Ka-shing knew that he had suffered a big setback this time, but he thought that the matter was not over yet!

HSBC still holds 4000 million shares of Hutchison Whampoa. If you buy them yourself, you still have a chance to take over Hutchison Whampoa!
As for the opponent Fang Hexuan, humph, just wait and see!
　Thanks to book friend 20220508082954628 for your monthly ticket!
　　
　
(End of this chapter)