Return to 1958 and build a century-old giant

Chapter 934 Asset Statistics and Privatization of Landmark

At the headquarters of Cheung Kong Holdings, Li Ka-shing, wearing thick glasses, stared at the newspaper in his hand, remaining silent for a long time. Chong Yuet-ming, standing beside him, asked, "What's wrong?"

"Take a look at this. You should know about this news, right?" Li Jiacheng handed over the newspaper.

Zhuang Yueming took the book, glanced at the title, and said, "I know, I found out this morning. It's nothing to be surprised about. Didn't you say a long time ago that Yang Wendong's ultimate goal was to acquire land?"

Li Ka-shing nodded and said, "I did say that, but now that the day has actually come, I'm still quite emotional. Yang Wendong has basically become the absolute hegemon in Hong Kong's business world. Even if all the other wealthy families in Hong Kong were combined, they couldn't compare to him."

“That’s normal. He doesn’t just have businesses in Hong Kong. His businesses in Europe and America are even larger than those in Hong Kong,” Zhuang Yueming said. “It’s probably because he developed overseas markets in the early days that he was able to earn so many profits, and then he invested in Hong Kong in return, which is how he got his current status.”

“Yes, back when we were all thinking about making money in Hong Kong, he was the only one who thought of expanding into overseas markets,” Li Ka-shing replied.

"There's no point in saying all this now. What's done is done. Yang Wendong has now further monopolized Hong Kong's real estate market. What do you plan to do?" Zhuang Yueming asked.

Li Ka-shing said: "Looking at Yang Wendong's plans over the years, his goal has always been to acquire land. He has become very involved in the real estate industry, especially the residential sector, and at most he only develops the land he owns."

I estimate that he will gradually withdraw from the Hong Kong property market in the future, and like his predecessor Jardine Matheson, he will simply hold enough high-quality properties and collect rent with peace of mind.

More than a decade ago, before the Kowloon Peninsula was developed in Hong Kong, Chinese capital such as Yang Wendong had not yet risen to prominence. Hongkong Land held a dominant position in the Hong Kong real estate market and basically did not participate in general real estate development.

“At his scale, he really wouldn’t be interested in ordinary residential properties. Just like you wouldn’t develop small properties worth only a few million.” Zhuang Yueming continued, “However, isn’t it a bit too risky to gamble our entire future on Yang Wendong’s wishes?”

“No, even if Yang Wendong gets involved, it will only benefit the real estate market. This isn’t industry; there’s no life-or-death situation here.” Li Jiacheng shook his head and said, “Besides, I’m also planning to follow in Yang Wendong’s footsteps and enter the overseas market.”

"Entering overseas markets? What industry?" Zhuang Yueming asked in surprise;

Li Ka-shing said, "Of course it's still the real estate industry. The Canadian Imperial Bank invited me to Canada to do a major renovation of the local Chinatown. As you know, quite a few Hong Kong people have immigrated to Canada in the past two years. So even though it's in Canada, they are essentially still Hong Kong clients, just like here."

"That puts my mind at ease." Zhuang Yueming nodded;
Li Ka-shing said, “In North America, I have a good relationship with the Canadian Imperial Bank. In Hong Kong, I have a good relationship with HSBC. Even in mainland China, we have a decent relationship. In the future, as long as we manage our business diligently, even if we cannot surpass Yang Wendong, my Li family will definitely become one of the top families in Hong Kong.”

"Yes, I believe you," Zhuang Yueming said with a smile.

Worldwide International Shipping Company:

Bao Yugang looked at the news in his hand, and casually patted his two twin sons who were wandering around him a few times, and laughed: "Mr. Yang really has big spending power. He acquired Jardine Matheson just like that. Impressive."

Huang Xiuying said, "The Yang family is really getting more and more powerful. It seems that Hong Kong will really be called the Yang family in the future."

"A new generation replaces the old; Hong Kong will soon belong to the Yang family," Bao Yugang remarked with emotion.

The news of Hongkong Land being acquired by Cheung Hing Group spread throughout Hong Kong in less than a day, and by the next day, even many overseas media outlets knew about it.

The New York Times described the end of British control in Hong Kong as "The End of the Age of Empire."

The top British giants that once controlled all sectors of Hong Kong's economy were acquired one by one by Chinese-owned Hong Kong companies, leaving only a few industries such as airlines and water companies still under British control.
It further mocked that the decline of British capital in Hong Kong was essentially the decline of the British Empire, and also discussed the recent Sino-British negotiations, implying the incompetence of the British government.

"These American media outlets really love to make fun of Britain," Yang Wendong said with a smile after reading The New York Times.

Fang Xianming said, "That's normal. After World War II, on the surface it was a battle between the US and the Soviet Union for hegemony, but in reality, for at least the first two or three decades, it was an internal struggle between the US government and the British government. The US wanted to swallow up the colonial interests of Britain and create liberalism. Otherwise, why would the US be so kind?"

“Yes, the British Empire, which has dominated for over a hundred years, has too much fat in its hands.” Yang Wendong nodded and said, “Now it’s almost ready to give it all up.”

According to historical records he knew from his previous life, after World War II, the relationship between the United States and the Soviet Union was very strained for some reasons, but the crippled president's original intention was still to work with the polar bear to first take away the huge profits and markets of Britain and France overseas.

It's a pity that just as preparations were underway, the crippled president died, and the newly elected president changed policies, triggering the Cold War, which allowed Britain and France to survive for several more decades. Otherwise, this matter would probably have been resolved by the 60s.

Zheng Zhijie, who was standing to the side, took out a document from his briefcase and said, "Mr. Yang, the asset list of Jardine Matheson has been completed. Please take a look."

"Hmm, let me see." Yang Wendong took the document and began to read it carefully.

The first page is a catalog listing the names of some of Landsea's properties. The top dozen or so are the entire buildings in Central, Hong Kong Island, followed by various buildings in Kowloon Peninsula.

The second page is also a table of contents, but it doesn't show the complete building anymore. Instead, it shows parts of the building, such as a few floors or a certain area of ​​property.

Starting from the third page, each property is introduced, including its history, list of tenants, annual rental income, maintenance income, debt situation, and other core confidential information.
Among these, the most valuable is undoubtedly the Exchange Building next to the Connaught Building, with a land area of ​​14.4 square feet. After completion, the building will have a total area of ​​nearly 200 million square feet, making it the largest single building in Hong Kong in terms of floor area, much larger than the Connaught Building, and located in a prime waterfront location. The following information includes other buildings, including Landmark, Duke's Building, Prince's Building, Alexandra Building, Standard Chartered Building, Gloucester Building, York Building, Hong Kong Club Building, etc.

Following that are seven or eight buildings in Kowloon Peninsula, as well as a large number of property descriptions that are not for entire buildings.
The final page shows that Hongkong Land Group owns a total of 1058 million square feet of property, and also has 320 million square feet of buildings under construction, but construction has been halted due to funding issues.

For example, the more than 100 detached villas on the south side of Hong Kong Island, the renovation of the former Miramar Hotel site, the White Pen Hill development project, and the development of some residential communities, etc., once these are completed, some will be sold according to demand, but at least 1.5 million square feet of self-owned property and a large amount of cash can be obtained.

After closing the documents, Yang Wendong stood up, walked to the window, looked down at the unfinished trading building, and asked, "Are all these suspended projects ready to start?"

Zheng Zhijie replied: "Yes, we are ready to start construction. However, Land previously laid off many employees and even engineers. Now we need some time to bring them back."
Although our Kinmen construction skills are no worse than theirs, they were the ones who did the project before, so we need to have a better understanding of it. At least some of their people need to come back before the project can begin.

"Yes, okay. Security is involved, so we can't be careless." Yang Wendong said, "We've taken over a huge mess. It will take some effort to sort things out. I'll have to trouble you during this time."

Hongkong Land can certainly make money effortlessly in the future, but at this critical juncture, with heavy debts and projects halted, it still needs to clean up the mess and at least get all the projects running again, otherwise the longer it drags on, the more troublesome it will become.

Zheng Zhijie replied, "Don't worry, Mr. Yang. Changxing Real Estate Company doesn't have any other major issues at the moment, so I will focus all my resources on Zhidi."

“Okay.” Yang Wendong nodded, then looked at Fang Xianming and asked, “How is the debt of Zhidi being handled?”

Fang Xianming replied, "According to our previous agreement with Sumitomo Bank, all of Hang Seng Bank's Hongkong Land debt has been transferred to them."

The other banks have not yet made a statement. I have contacted them one by one, and they have all expressed that they believe in our repayment ability and will not urge us any further. Everything will be handled in accordance with the existing contract.
Several banks even considered lending us more money, but I declined them for the time being.

"Haha, these bank people really know how to add insult to injury. They know we're not short of money, so they're scrambling to give us money," Yang Wendong said, shaking his head slightly.
That's how banks are. If a company is doing well and doesn't need money, they'll be eager to lend you money. Conversely, if a company is doing poorly, they'll want to collect the previous loans as soon as possible.

Fang Xianming said, "Yes, that's how the financial market is."

Yang Wendong looked at the documents in his hand again and said, "Old Zheng, of the properties that Landsea has to develop, apart from the Transaction Building, we can consider selling some of them after they are completed, especially the residential ones. We will not participate in this area in the future, so we can also recover some funds."
Even with the help of the parent group, it can only provide temporary relief. You'll still have to repay this enormous sum yourself in the future, since Hongkong Land is currently a listed company.

“Yes, Mr. Yang,” Zheng Zhijie replied.

Hongkong Land also owns many undeveloped properties, including high-end residences and villa complexes, which can generate some revenue upon completion.

Fang Xianming asked, "Mr. Yang, Hongkong Land's business is somewhat similar to Wharf Holdings'. It has basically reached its limit in Hong Kong. Should we take advantage of the current low share price and carry out a full privatization?"

"Full privatization?" Yang Wendong thought for a moment and said, "Okay, let's formulate a plan first. We'll keep it strictly confidential internally to avoid leaks that could cause the stock price to soar. Right now, it's indeed a suitable time."

Of the many companies he acquired in his early years, Wharf Holdings was privatized, but Hutchison Whampoa was not.

On the one hand, Wharf Holdings' business is relatively simple. The rental income from Harbour City was unknown to anyone in the early days and could not be reflected in the stock market. At that time, privatization would have allowed them to profit more.
Hutchison Whampoa is a different story. Its main business is not property rental, but various other businesses, many of which involve overseas markets. Therefore, having a listed company status would be very convenient. Yang Wendong also needs one or more companies to be linked to the Hong Kong stock market in order to obtain financial benefits.

The current state of Jardine Matheson is actually similar to that of Wharf Holdings. My future requirement for Jardine Matheson is to focus on collecting rents, with its main business still in Hong Kong. At most, it will participate in future investments in mainland China, so there is no need to keep it listed.

Taking advantage of the current property crisis and its low market value, after privatization, once Hong Kong property prices rise more than tenfold in the future, all the profits will be theirs.

Most importantly, if the huge rental income all goes to one's own person, then it will be much more convenient to use it.
In other markets in the future, he may need a lot of money to launch price wars, which are very expensive. Having a lot of stable income properties behind him will make things much easier.

"Okay, I'll prepare the materials and funds right away," Fang Xianming said with a smile.

Yang Wendong said, "Well, as for funding, we can contact Citibank. I will use my credit line in the United States."

Both the current debt of Jardine Matheson and the funds required for the privatization of Jardine Matheson require a great deal of capital.

Although you could raise that much money in your accounts in various countries, you should use bank funds whenever possible instead of your own. This is one of the ironclad rules of doing business.

The profits he made from investing in gold futures in his early years have been converted into shares of more than a dozen large, top-tier listed companies in Europe and the United States. These shares are high-quality financial collateral assets, which can easily provide sufficient credit lines.
In fact, because these stocks have risen significantly in the past two years, the credit lines they can obtain are higher than the previous returns from gold.

“In that case, the funding problem will be solved,” Fang Xianming continued. “But Hongkong Land also owns a Hong Kong telephone company, which Hongkong Land acquired years ago.”
Telephone companies are public infrastructure enterprises and cannot be wholly owned; we can only maintain the status quo.

“A telephone company? Sure, we can privatize the land, and the telephone company will remain unchanged.” Yang Wendong thought for a moment and said, “Bring me the telephone company’s information tomorrow.”

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(End of this chapter)