The Birth of Shanghai's First Conglomerate

The next day.

Chen Pingsheng drove his Volkswagen Phaeton to the group headquarters.

There wasn't much to discuss this time; the main purpose was to discuss the listing process of Tencent Media.

With the listing quota provided by Guangzhou, the listing process will definitely be smooth sailing. Their main task is to find suitable IPO financing targets.

They can also be described as strategic investment partners.

Tencent Media's current valuation is 450 billion yuan, based on the initial investment by Guo Ziyi.

The IPO valuation will likely be around 60 billion, a slight increase that would allow early investors to cash out more easily.

This valuation won't be achieved so easily.

After all, Xin Teng Live's market value is still less than 60 billion. Chen Pingsheng met with Shen Nanpeng and Tong Zhelan and asked them to look for investment targets in the capital market.

This time, the equity dilution will not be as high as 60%, but 40%.

The IPO fundraising target is 240 billion.

With the booming popularity of Douyin and the short video economy, this goal is still achievable.

It just needs some time.

If this financing is completed, based on his remaining 35% stake, cashing out 40% would be 14%.

It could yield approximately 84 billion RMB, which is definitely a huge income.

With a little more boost from the cheat code, the R&D funds needed for Tengfei New Energy in 19 will basically be raised.

Shen Nanpeng suggested bringing some physical businesses into Tencent Media as a package.

If it relies solely on its network of online celebrities and guild live streams, without any real economic activity, the capital market will find it hard to believe that it is worth 60 billion.

Tong Zhelan also supports this suggestion, saying that the benefit of bringing in real businesses is to achieve a combination of the virtual and the real, which can also better tell a good story in the capital market.

Relying solely on internet celebrities is certainly not enough to support a valuation of 60 billion.

Chen Pingsheng thought about it and agreed that it made sense. He had many businesses under his control, so acquiring a few physical companies was no big deal.

However, deciding which companies, after being acquired, will enhance the narrative of Tencent Media is a crucial decision.

Chen Pingsheng said, "The original intention of my investment of 1.2 billion yuan in Nine Warehouse two years ago was to improve its live-streaming e-commerce in the clothing sector after Tencent Media took off. Currently, Nine Warehouse has directly operated stores in major cities. Why not package it and merge it into Tencent Media first?"

"That's no problem."

Shen Nanpeng must know about No. 9 Clothing Warehouse. In the current situation, it's extremely rare to find someone who can still invest over a billion yuan in a physical clothing store.

When Chen Pingsheng invested this money, he knew it was to prepare for live-streaming e-commerce.

Looking back now, it was indeed true.

They want to inflate Tencent Media's valuation to over 60 billion.

That means it's necessary to include some physical industries in the package.

"But if your Warehouse No. 9 is priced too high, investors probably won't accept it."

"I invested 1.2 billion, so it's not unreasonable to include it as 1.5 billion!"

"It's not excessive, it's just right."

Shen Nanpeng added, "Besides Warehouse No. 9, you should also incorporate some department stores to improve the future department store sector. Once this step is completed, Tengyou Media's valuation of 60 billion will definitely be achieved."

Chen Pingsheng certainly didn't lack department stores and supermarkets.

He had one of the earliest Teng Hui Department Stores, but as a result, Tengyou Media had to acquire a certain number of supermarkets from Teng Hui Department Store, at least no less than one hundred.

This is fundamentally different from investing in Teng Hui Department Store, which is a cooperative relationship.

The acquisition of a number of supermarkets involves carving out a portion of the stores.

Having its own independent supermarket brand will give Tengyou Media a clear advantage in the future live-streaming e-commerce sector.

Teng Hui Department Store is currently valued at around 20 billion yuan. Apart from its stores in Beijing, Shanghai, Guangzhou, Shenzhen, and Hong Kong, it owns all of them.

In other cities, storefronts are mostly rented.

It's no exaggeration to say that his market value of 20 billion is roughly equivalent to the number of stores he has in these top-tier cities.

Chen Pingsheng simply waved his hand and sold all of Teng Hui Department Store's supermarkets except those in Beijing, Shanghai, Guangzhou, Shenzhen, and Hong Kong.
All the stores in other cities were sold to Tencent Media.

For pricing, the finance department needs to provide specific data.

We cannot give an accurate number at the moment.

For Shen Nanpeng and Tong Zhelan, spending several billion more to acquire Tenghui Department Store was no big deal at all.

After all, they were all early investors in Tencent Media, and once Tencent Media achieves a valuation of 60 billion, that will be crucial.

That's when you really make a fortune.

It is a normal business practice for companies to buy some core assets before going public to increase their valuation.

Only after going public will they sell off those non-essential assets.

Of course, there is another situation: before listing, in order to make the financial statements look better and increase the confidence of retail investors.

Some companies deliberately sell off some core assets; these are usually fraudulent companies.

Tencent Media clearly does not belong to this category, and it has no assets to sell.

The only option is to increase physical assets. On November 18, 2018, Tencent Media released a press release.

They acquired Nine Clothing Warehouse for 15 billion.

The news came out, but the capital market remained quite calm. After all, both Tong Zhelan and Shen Nanpeng are big names in the capital market.

They want to join forces to push Tengyou to go public and also attempt to achieve a valuation of 60 billion yuan.

It is inevitable that some physical assets will be purchased.

On the same day the news broke, Zhang Wanyi held a press conference in Guangzhou to explain the significance of the acquisition.

The acquisition cost was 1.5 billion, with 1.2 billion being investment costs.

Even a small profit of 300 million is still a profit.

Chen Pingsheng used the random amplification once, and luckily, he got five times the return.

With the 1.5 billion yuan principal that came back this time, it suddenly has 3 billion yuan.

Although he was the sole investor in Warehouse No. 9, it was also built up by his old classmate Yao Anni and a group of people.

These early founders all received a certain amount of phantom stock, which they could only cash out after the IPO.

Nine Warehouse is no longer going public; it has been merged into Tencent Media.

This means that the dreams of all the executives at Nine Warehouse who received shares in the company have been completely shattered.

Chen Pingsheng was also unwilling to let down those who believed in him, so he took out 300 million yuan as a bonus and gave it to Yao Anni and the senior executives of the company she led.

Many of them were transferred directly from Tencent Film Group.

Yao Anni personally received 80 million yuan in rewards, while the remaining 24 executives shared 160 million yuan.

The remaining 60 million was given to nearly 100 middle-level managers.

It's roughly equivalent to each person receiving a cash reward of 600,000 yuan.

This way, everyone is happy, and as for the grassroots employees, things remain the same as before.

It has little to do with them.

After Nine Warehouse was merged into Tengyou Media, all store managers, including the next level of management, had to start following the path of becoming online fashion influencers, as required by Tengyou Media.

That is, live-streaming e-commerce.

As a result, Tengyou Media has gained 1,200 more directly operated clothing stores and over a thousand professional live streamers specializing in clothing.

As a result, the company's valuation skyrocketed.

December 18, 11.

Teng Hui Department Store announced that it will open 138 Teng Hui Department Store supermarkets outside of Beijing, Shanghai, Guangzhou, Shenzhen, and Hong Kong.

The entire package was priced at 6 billion and sold to Tencent Media.

To be honest, the supermarket business hasn't been too good in recent years. Apart from its own stores in first-tier cities, Teng Hui Department Stores in other cities have had mixed results.

Selling these 138 supermarkets signifies that Teng Hui Department Store will only focus on development in first-tier cities in the future.

This also means that it is no longer burdened by unwieldy business. As soon as the news came out, the stock price of Hong Kong-listed Teng Hui Department Store soared.

Unfortunately, this money cannot be increased randomly.

The main reason is that he doesn't have many shares in Teng Hui Department Store anymore, only 5%.

The six billion yuan in revenue will be included in Teng Hui Department Store Group, and how it will be used in the future will need to be determined later.

Two investments have enabled Tengyou Media to own more than 1,000 physical clothing stores and more than 100 super-large department stores.

After completing these two investments, Tengyou Media's storyline has become significantly stronger.

Of course, these two sums of money didn't just appear out of thin air.

Tengyou Media is raising funds internally, with its current shareholders jointly completing this 8 billion yuan financing round.

Chen Pingsheng also owns 35% of the shares, and naturally invested 28 billion yuan in it.

A typical example of transferring money from the left hand to the right.

The final result was that everyone agreed that Tencent Media's valuation of 60 billion yuan was still too low.

It needs to rise to 80 billion.

Otherwise, it would be a waste of the 75 billion yuan they spent on the acquisition.

Alright… Chen Pingsheng reluctantly agreed to the suggestion.

He wouldn't object if it rose to 800 billion, as long as there are still fools willing to take it over.

If no one takes over, then they themselves are the big fools.

After Tengyou completes the acquisition of these assets, it will definitely take some time to digest them.

Fortunately, these are all industries under Chen Pingsheng's Tengying Group, projects born from the same father.

It won't be too difficult to integrate them.

(End of this chapter)