Hong Kong 1980: The Savage Era

Chapter 134 [BEST Century City]

Monday, September 10
Zhaoan Real Estate Company and Hongpu Real Estate Company jointly held a press conference, announcing that the two companies will work hand in hand in the future to cooperate on a number of major projects.

Such ambiguous news resulted in little increase in the share prices of the two companies, which basically remained at their original levels.

Hongpu Real Estate Company Meeting Room

Luo Qihong's original office here has changed its owner and become Li Yude's office. Lin Luoqi serves as the chairman of the board of directors of Hongpu Real Estate Company, and Li Yude is naturally the vice chairman and general manager.

“百世置业有限公司成立于67年.在中环皇后大道中176号锦安大厦、卑利街19号增信楼各持有两层商场，总面积多达3万2千4百平方尺”

"The office space held in Central is 5.2 square feet"

“Owns 41 residential properties in Repulse Bay, Causeway Bay and North Point, including 29 luxury homes.”

“We have two development sites in Tsuen Wan West and one in Tuen Mun. The area is as high as 2 square feet.”

Wood Feng, a senior executive of Hongpu Real Estate Company, was reading a report with a serious look on his face.

Luo Qihong was not interested in the properties of Best Real Estate Company, but he was somewhat concerned about its land development capabilities. After all, this was something that Zhaoan Real Estate Company did not own.

Luo Qihong closed the file and said calmly, "This Best Real Estate Company has good assets, but its debt ratio is also shocking, as high as 77%. The rent of its properties can only pay the interest on its debts. Many development sites have been stopped, and it is only a step away from bankruptcy."

Best Property Company was originally a well-qualified enterprise that survived the great crisis of 73. Unfortunately, it began to expand rapidly in 79, almost at its peak, acquiring more than 6% of the properties and land in the city.

Now the situation in local cities is unclear and the growth rate in local cities is very sluggish, so a relatively big crisis has emerged.

The founder is already 62 years old, and the heirs are unable to reverse the profits and losses. They can only think about stopping the losses in time and getting out smoothly.

Wu Defeng stopped talking and looked at the three bosses somewhat awkwardly.

"There is indeed such a big problem, but the advantages of Best Real Estate Company are also obvious. It is cheap enough, and we can use a small amount of funds to control a listed company with a market value of 100 million yuan." Li Yude refuted gently, "and Best Real Estate Company's land development capabilities can well make up for the shortcomings of Hongpu Real Estate Company."

"Rocky, what's your opinion?" Luo Qihong turned around and asked.

"I agree with Uncle Li's opinion. Best Real Estate Company is very suitable for us. Those well-run companies charge too high a price or require competition, and the final cost is too high. Hongpu Real Estate can hardly afford it." Lin Luoqi said worriedly.

"Okay, then we have tentatively decided to acquire Best World Real Estate Company." Luo Qihong glanced down and said, "Then how do you want to distribute the equity and management rights?"

Li Yude and Lin Luoqi looked at each other, and it was obvious that they had already discussed it.

Li Yude responded, "Hongpu Real Estate must hold at least 40% of the shares to become the majority shareholder, Zhaoan Real Estate Company must hold 25% of the shares, and Rocky will manage Best Real Estate Company. How about that?"

"I have no objection to the issue of operating rights, but I hope to own 30% of the shares. Once Best Real Estate Company is on track, Zhaoan Real Estate Company will take the initiative to reduce its stake." Luo Qihong did not have much interest in Best Real Estate Company.

However, he noticed one thing. After Best Real Estate Company was on track, it should be separated and Lin Luoqi would be the boss. Otherwise, Hongpu Real Estate Company would not be able to be run so smoothly by Li Yude.

This plan should have been concreted before the acquisition of Hongpu Real Estate Company, but it is only being announced now.

"Okay, but if Zhaoan Real Estate Company takes the initiative to reduce its stake, we should be given priority." Lin Luoqi glanced at Li Yude and said.

"That's natural." Luo Qihong smiled. "Director Wu, please tell us the details of the asking price of Best World Real Estate." Li Yude glanced at Wu Defeng and said.

Wu Defeng serves as the director of the board of directors and deputy general manager of Hongpu Real Estate Company, responsible for the acquisition. He is also a talent poached by Li Yude from other places.

"Everyone is clear about the details of Best Real Estate Company. Its major shareholder holds 42% of the shares, and the market value of Best Real Estate Company is 1 million yuan, and the major shareholder wants to sell it at the market price, which is 1 million yuan," Wu Defeng said in a complicated manner.

"How many competitors are there in the acquisition of Best Real Estate Company? How strong are the competitors?" Luo Qihong asked.

"There are only two competitors at the moment, Century City Co., Ltd. and Xinchang Real Estate Co., Ltd. The highest bidder is Century City Co., Ltd., which bids 8% of the market price." Wu Defeng said, "Century City Co., Ltd. is slightly stronger than our company, while Xinchang Real Estate Co., Ltd. is a little weaker."

Century City?!
Isn't this the Century City that was acquired by Luo Xurui of the Luo Yingshi family in 85?
I actually met you here.

Luo Qihong secretly thought that he must have something extraordinary to be favored by Luo Xurui.

"Xinchang Real Estate Company has made some achievements in land development, but it is quite weak in properties. It should want to absorb all the properties of Best Real Estate Company to strengthen its strength in this area, while Century City should be interested in the entire Best Real Estate Company, which has relatively balanced strengths in properties and land development." Wu Defeng gave a brief overview.

"My opinion is to give 5% more, up to 9% of the market price." Luo Qihong said in a deep voice, "After taking over Best Real Estate, we will have to issue new shares and inject capital into Best Real Estate. This is not a small amount, and the current Best Real Estate Company is no longer worth the market price."

Li Yude nodded and said, "If they still don't agree to 9% of the market price, I suggest that you purchase 30% of the shares at the market price, and then issue new shares to our two companies through the board of directors. This way, you can inject capital and strengthen control."

"Okay, then let's do as you suggest, Uncle Li." Luo Qihong agreed immediately.

"I agree too." Lin Luoqi quickly tried to make his presence felt. This was his company.

After leaving Hongpu Real Estate Company, Luo Qihong and Lin Luoqi chose a teahouse and wanted to talk alone.

"Have you discussed today's events with Uncle Li?" Luo Qihong took a sip of tea and asked jokingly with a smile.

Lin Luoqi did not hide anything and said, "We did discuss this matter, otherwise I would not have handed over Hongpu Real Estate Company to you."

"It is true. I also wonder why you want to give up Hongpu Real Estate. Why? Is it because you don't have enough funds?" Luo Qihong asked casually.

"Yes! I have sold all of my 17% stake in Yiren Real Estate Company, and only raised less than 7 million yuan. This is far from enough." Lin Luoqi said regretfully.

"How do you plan to divide the Best Property Company?" Luo Qihong was naturally asking about the future.

"Give me half for the land development, and give me all the properties." Lin Luoqi said calmly.

"This is indeed a win-win solution." Luo Qihong nodded and smiled.

"This is not a win-win situation. This is the only solution." Lin Luoqi said with a wry smile.

Luo Qihong thought about it and asked, "What about your family? You don't plan to go back?"

When talking about this, Lin Luoqi became more depressed. "You are right. It is right to start a new business, but I have to contribute my share."

(End of this chapter)