National Tide 1980

The entire 1980s, in the history of world finance, is also known as the decade of greed.

Why?

In fact, the answer has nothing to do with Japan's economic bubble.

It is mainly because corporate mergers and acquisitions in Europe and the United States have become an excellent business.

And there are more and more ways to play.

As we all know, in modern times, under the background of the industrial revolution, under the capitalist system of Europe and the United States, large-scale and unprecedented private enterprises have emerged in Europe and the United States.

These private companies have not only overturned the old lifestyle one by one, but also taken the lead in all walks of life, almost constituting the most important part of the world economy.

This situation remained roughly the same until the 1980s.

However, in the 1980s, a large number of founders of European and American companies were getting old and were facing the problem of corporate inheritance.

These old people had to allow professional managers from all walks of life to take their place on the stage and start to dance with guns and sticks.

In the context of slowing economic growth, many companies began to merge and reduce competition in order to survive.

Therefore, increasing income and profit scale through mergers and acquisitions has become the only choice and basic operation for professional managers in this era.

LVMH is a typical example.

LV's Henri Lacamier hopes to expand the company's business categories in order to stabilize the company's operations and bring profits to a higher level.

MH's Alain Chevalier is most afraid of the complexity of shareholders and insufficient voting rights of the management. He hopes to hold on to a big tree to avoid being acquired by outsiders.

It is precisely because of different interests that the two of them were willing to complete the marriage of brands and companies in the first place.

In addition to this reason, in this era, there are many loopholes that can be exploited in corporate mergers and acquisitions, and it is really possible to pick up gold.

Although there are laws and regulations, the law still needs to be improved.

Commercial companies also have problems such as untimely, opaque, and slow dissemination in information disclosure.

In addition, there are always a few geniuses in this world. Even if they are appointed by the founder, the management of most listed companies is very corrupt and incompetent.

They are often best at building relationships rather than managing the company effectively. Most CEOs often destroy value rather than create value.

This has led to many companies being seriously underestimated, and the quality of the company is seriously deviated from the value of their issued stocks.

As an aside, it was actually because it was difficult to find a suitable successor.

Whether it was Henri Lacamier or Pierre Caton himself, even though they knew that their health and energy had declined greatly, they still had to personally take charge of the company and sit in the position of the top leader to support it.

None of them could rest assured and hand over their brands and companies to outsiders to run.

Therefore, in such an ecological environment, this led to frequent mergers and acquisitions in European and American countries during this period, and a large number of financial tycoons emerged to feed on this.

From 1982 to 1988, the overall transaction amount in the United States alone rose from 11 billion US dollars to 181.9 billion US dollars. It can be said that every family has wine to drink and everyone has meat to eat.

Then there is no doubt that the world's financial center has shifted from the United Kingdom to Wall Street in the United States.

At present, those engaged in this industry are of course also based on American companies and Americans as industry benchmarks.

In this era, the most famous private equity fund in the United States is KKR.

This private company, which has three founders and a history of less than ten years, has achieved amazing success in corporate mergers and acquisitions.

Not only has it long been famous and has long consolidated its position as the top acquirer on Wall Street, but its management scale has also left its followers far behind.

They are even the root of the term "barbarians at the gate".

You know, a year later, in 1988, KKR relied on its wealth to confront the management without reaching a consensus with the management in the business war to acquire Reynolds-Nabisco, and completed the acquisition by completely tyrannical and tough means.

Therefore, it got this classic name from its competitors, and it became the name of the books and movies that recorded this acquisition in the future, and it also became a keyword in the Chinese capital market from 2015 to 2017.

As for the company that can match their M\u0026A capabilities and achievements in the world, there is only one lone ranger-Carl Icahn, known as the "corporate predator" in the United States.

In 1985, Carl Icahn became famous in the hostile takeover of TWA and became the "Wolf of Wall Street" that terrorized the United States.

Icahn Capital under his name has a higher annualized compound interest rate than Buffett, Madoff, and Hunt Ross, but the way of playing is completely different.

Carl Icahn can keenly observe the differences in interests between senior managers and shareholders of listed companies, and use various financial means to make profits.

Of course, this is also the secret of KKR's wealth.

The commonality of playing this kind of capital game is that in addition to having a unique vision and being able to keenly discover good companies and their weaknesses, you must be good at using various financing methods to maximize your leverage.

Because of this, if you want to look at everything Bernard Arnault has done to LVMH with a professional eye.

It is actually difficult to give an excellent evaluation to this French wolf who has just developed bloodthirstiness and is far from grown up.

In fact, Bernard Arnault is very much like a Jew, with a greedy heart and a vicious and selfish character. In terms of M\u0026A experience and means, he has obvious gaps and too many shortcomings compared with real M\u0026A experts.

You should know that in corporate M\u0026A transactions, the most stable business processes and most successful models should usually be carried out in accordance with the following steps.

First, choose a company worth starting and find the weaknesses of the company.

Second, negotiate with the management to reach an agreement on the intention - for example, although it is a comprehensive acquisition, the management will be given equity and management incentives).

Third, design a plan to complete fund raising - which inevitably requires considering factors such as interest rates, cycles and equity capital ratios.

Fourth, acquire shares to complete privatization.

Fifth, improve short-term operating efficiency - after taking over the company, it often tries to increase cash flow and profits for three to five years by reducing costs and splitting businesses, bringing public confidence and stimulating stock price increases.

Sixth, sell shares - be acquired or re-listed, and then sell them at a higher price to exit.

In short, the essential elements are timing, funds and allies, which are the time, place and people in Chinese culture.

So in order to hit the target and reduce variables, even industry leaders KKR and Carl Icahn have to reach a consensus on interests with some people in the company before acquiring the company and make some concessions appropriately.

Then they raise funds to complete the acquisition, and finally push up the stock price or split it up and sell it, in exchange for a result that all shareholders can benefit from.

So that even if their image in the media has become a cold corporate predator, even though the management of American listed companies all stay away from them.

But Fortune magazine gave positive affirmation from the perspective of shareholders, saying the voice of another part of the people - "Whether you believe it or not, they make more money for shareholders than any other speculators on the planet."

But Bernard Arnault, he is not like that.

First, he was lucky to acquire LVMH. It was Henry, who was so ignorant of the ways of the world, who was so foolish that he offered himself to him. Otherwise, he would not have had any chance at all.

Secondly, Bernard Arnault relied on fraud and deception to do things. He betrayed and plotted against others.

He was too selfish and stingy. His ultimate goal was to take all the benefits for himself.

He had lost his morality and it was difficult for him to have real helpers.

In addition, his funds were only provided by Lazard Investment Bank.

He lacked professional financial ability. He did not know how to issue junk bonds or establish private equity funds. His methods were single and his funds were limited, resulting in high financing costs.

In fact, it was difficult for him to succeed in any aspect.

Even now, he was in the limelight and had taken advantage of the internal fighting war of LVMH.

But as long as we analyze it carefully, we can see that his strength is limited.

There are undoubtedly major hidden dangers in all aspects, and he has stepped on the mine of "losing the way and having few supporters".

It can only be said that in the last life that Ning Weimin experienced, this business war that could be called the first in Europe was not actually a high-level battle.

The reason why this French wolf was able to succeed was largely due to luck and was a matter of accident.

The main reason was that the French financial market was too small, developed too slowly, and the merger and acquisition qualifications were relatively closed, which gave him, an outlier who did not want to be a gentleman at all, an opportunity to take advantage of and grow.

Otherwise, if the Americans also set their sights on the fat piece of LVMH, if there were no restrictions on the proportion of foreigners' holdings, I'm afraid there would be no Bernard Arnault.

So even though Ning Weimin had no experience in corporate mergers and acquisitions, and entered the game late, it seemed that the opportunity was gone.

Although he did not have much funds, he could only rely on the hundreds of millions of dollars he and Pierre Cardin raised to fish in troubled waters and take advantage of the second half.

Even he was a Chinese, and it was impossible for him to control the entire LVMH Group.

But in fact, it is really not that simple to look at it.

In fact, Ning Weimin's disruption is not only the biggest variable in this business war.

It is destined to bring an unexpected turn to the final result of this business war.

Even for Bernard Arnault, the appearance of Ning Weimin means that he already has his own natural enemy.

First of all, Ning Weimin, a man with a good business spirit, represents the good in business.

He advocates harmony, knows how to share, pays attention to balance, and emphasizes integrity, which runs counter to the selfish and immoral French wolf.

This ensures that his alliance is unbreakable and has the benefit of many supporters.

Although he has not yet been recognized and valued by the fourth generation of LV, as long as Henry finds that it is impossible to achieve peace through appeasement, he will know what to choose sooner or later.

Secondly, funding is not Ning Weimin's disadvantage, but his biggest advantage.

On the surface, because of the influence exerted by Lazard Investment Bank, no bank in France is willing to lend money to those who want to help the fourth generation of LV.

But the source of Ning Weimin's funds came from Japan, which was at the height of the economic bubble. Japanese banks had already begun to cry and shout, and even knelt down to beg for loans.

As long as he is willing, he has too many real estate properties and companies that can be used as collateral to obtain huge loans.

Moreover, loan interest rates are much lower than those of banks in European and American countries.

How can it be compared to a French wolf backed by Lazard Investment Bank?

In fact, his "ammunition" is only superficially lacking, but the reality is that it is quite sufficient.

What's more, he doesn't seek control of LVMH.

As long as I can get LVMH shares at a low price, I will wait for dividends and enjoy the worship of vain people all over the world.

Whatever the end result is, it will be a personal victory for him and he will be satisfied.

As for the end, Ning Weimin also had an exclusive advantage in timing, and no one could imitate it.

Even if Bernard Arnault entered the game first and already controlled 37.5% of the group's equity, his advantage would not be as great.

After all, he is a time traveler who can "predict the future" and has a time plug-in.

Looking at the calendar and counting the time, he certainly knew that the famous "Black Monday" in history was not far away.

Although the timing of this stock market crash, which has made the entire capitalist world tremble, may not change due to the butterfly effect, the general trend will not change.

What is absolutely certain is that this will eventually happen to stock speculators around the world.

For Ning Weimin, this is the best arbitrage opportunity with a guaranteed win and no loss.

If God is kind and allows him to be fully prepared and lay the groundwork, then it won't be a question of how much profit he can make personally.

There is a very high probability that he can help Henri Lacamie stand up in one fell swoop, avenge his past humiliation, and completely drive away the powerful enemy that dominates the magpie nest.

By the way, he can also promote the master to the board of directors of Louis Vuitton and repay his mentor and helpful friend with generous benefits.

So, even though Ning Weimin did what seemed the stupidest thing.

He and the master used CLSA, a brother company of Credit Agricole, to entrust a stock broker to start a two-way bet on LVMH, which was already obviously at a high level.

We plan to spend 300 million US dollars to acquire shares first, and then start short selling after buying them.

Later, they will use Matsumoto Keiko's name to open an account and sell the same number of shares through securities lending.

But his psychology is indeed completely calm, let alone uneasy. He is not at all panicked by the further push up of the stock price.

This has left CLSA's stockbrokers and analysts collectively confused and confused.

No matter how they thought about it, they couldn't figure out the real intentions of these two big customers.

Because hedging in the securities lending game seems to be meaningless. If there is no extreme market trend of sudden rise and fall, it will only contribute fees and commissions to the securities companies in vain.

They never dreamed that someone could predict the occurrence of extreme market conditions in advance. They did this in order to wait for the best arbitrage opportunity and make the right layout in advance.

But then again, even if Ning Weimin had the upper hand and had thought of everything he could think of, he wouldn't be able to control everything.

No, an unexpected situation soon caused him to have new needs for funds.

Because Catherine Deneuve found him a few days later when he was just starting to sell, and because she recognized his character, she asked him to invest in Saint Laurent Company.

Ning Weimin never expected that sometimes the luck brought by his good character would also be a burden.

This can not but be said to be a kind of sweet trouble.