Hong Kong 1980: The Savage Era

Chapter 286 287 [Investment can disperse the crisis]

Li Jiacheng's competition with the Great Eastern Telegraph Company was very fierce, almost double the amount when he competed with Li Zhaoji for control of the Electric Light Company. First, he acquired 38.8% of the telephone company's shares from the Hong Kong Land Company at a high price, which included a batch of valuable properties. He also sent acquisition letters to various shareholders of the telephone company.

Li Jiacheng acted very quickly and was not as hesitant as before.

Since most of the shareholders of the telephone company were British or British-owned companies, Cable & Wireless thought they had a natural advantage. However, who knew that Li Jiacheng was so capable and had persuaded many of the foreign shareholders to sign contracts, catching Cable & Wireless off guard.

It can be said that it took Li Jiacheng a lot of effort and money to go from a disadvantageous position to an advantageous position. The acquisition of the properties in the hands of the Hutchison Whampoa alone cost more than HK$20 billion, and it was estimated that it would cost nearly HK$30 billion to take over the telephone company.

Including the acquisition funds for the electric light company, Li Jiacheng's Cheung Kong Holdings and Hutchison Whampoa will spend a huge amount of HK$60 billion in just half a year, and the debts they bear are enough to make the two companies breathless.

For Luo Qihong, this invisibly weakened Li Jiacheng's strength and development momentum, giving him a lot of room for development.

It is also extremely beneficial to Li Jiacheng. The telephone company is the last high-quality large enterprise in Hong Kong. Once it is lost, Li Jiacheng will lose a basic base and his foundation will not be very solid.

Auctions jointly organized by banks
There were many good things in this auction, including some of the company shares that had not been liquidated when Yida Group went bankrupt, so it attracted many business tycoons, such as Guo Desheng of Sun Hung Kai Properties.

Merchants of all sizes filled the entire auction hall, and their whispers turned into a cacophony of noise until the host appeared and announced the start of the auction, when things quieted down a little.

Many people come here for the Golden Gate Building. This famous Grade A commercial building in Admiralty is priceless. Once the market turns good, the price will surely rise rapidly, bringing huge profits to the owners.

Moreover, in Central, where every inch of land is valuable, Grade A commercial buildings like Golden Gate Building are rarely available for sale, and can be said to be hard to come by.

The first to appear is the Lianwei Commercial Building at 283 Queen's Road Central, Sheung Wan, with a floor area of ​​21.3 square feet and a usable area of ​​19 square feet, of which the shopping mall area is 2.7 square feet. The starting price is 1 million yuan.

The property at this location is not very good, but it is a good choice for some small companies.

The big guys naturally wouldn't spend money on these small properties, so there was quite fierce competition among the small companies, and the bidding price once exceeded 2 million yuan.

In fact, it would not be a problem for this commercial building to double in value when the market is good. The auction price of 2 million yuan can still make a profit of 3 million yuan, excluding rent.

".Next is the 65% equity of Vinda Shipping. Although the shipping industry is not doing well now, Vinda Shipping had a market value of 24 billion yuan in its heyday and was a well-known shipping listed company. The starting price is 7 million yuan! Start bidding!"

By this calculation, the 65% stake in Vinda Shipping being auctioned at this time is less than 22% of its size in its heyday, which is a good expansion opportunity for some people who believe that shipping will recover in the short term.

"3 million!" The first person to raise the placard was Zhao Congyan from Huaguang Shipping, who shouted out the price with full energy.

Wanbang Shipping's Cao Wenjin also held up a sign that read "3 million!"

Cao Wenjin, one of the five shipping tycoons in Hong Kong, holds about 5% of the shares of IMC Shipping Company and shares of several shipping companies. He reduced his fleet without hesitation in 40, believing that the historical cycle of shipping decline had arrived, so this shipping storm had little impact on him.

Moreover, the Cao Wenjin family's investment in the shipping industry only accounts for about 25% of the family's assets. Even if there are large losses, it will not face the crisis of bankruptcy like Wheelock Company.

Cao Wenjin's bidding for the shares of Vinda Shipping at this time was undoubtedly because he saw that the 65% stake was cheap enough.

Cheng Yutong, who was not far away, was feeling itchy, but he already had a lot of ships. The Wheelock Company alone had ships of nearly 10 million tons, and he also had the Hong Kong Shipping Company.

In the end, Zhao Congyan acquired 4% of the shares of Vinda Shipping Company for RMB 3 million and became the new owner of Vinda Shipping Company. At the same time, he also added new debts to Huaguang Shipping Company, increasing the crisis factor.

The third lot is a 3% stake in the listed company Youlian Bank, with a starting price of 10 million yuan.

The operating condition of Youlian Bank is still good, but some bad problems have also arisen internally, which will lead to a major crisis if not dealt with in time.

However, among the numerous assets of Jianing Company, the 10% stake in Union Bank is one of the high-quality assets, so many people want to compete for it, including Guo Lingcan of Hong Leong Investment Company.

Next are shopping mall properties, commercial buildings and several large plots of land in the urban area of ​​Kowloon.

The 18th lot was a 25% stake in Thailand's Rama Tower Company, with a starting price of 3 million yuan.

At Luo Qihong's signal, Cheng Jianshen was the first to raise his placard and bid, "3 million!"

To Luo Qihong's surprise, not many people participated in the competition at Thailand's Rama Tower Company. Only a few medium-sized companies participated, and the competition was not as fierce as he had imagined.

Cheng Jianshen quickly bought 4% of the shares for 3 million yuan and got the first lot in Luo Qihong's plan.

The 20th lot was a 21.7% stake in the then sensational Qiaolian Real Estate Company, which was an asset of the Yida Group.

Although the market value of Qiaolian Real Estate Company has fallen from 8 million yuan at its peak to 6 million yuan, and it is also in debt of more than 3 million yuan, it is undeniable that it is still a real estate company that can be saved. A little capital injection can revive it, and returning to its peak is not a dream.

The starting price of this asset is 6 million yuan. Even if the premium is 2%, it is only the current market value of Qiaolian Real Estate Company, so there is still some profit to be made.

Even Cheng Yutong, who had been sitting on the throne, couldn't help but bid, which shows the quality of Qiaolian Real Estate Company.

This item was no longer in Luo Qihong's plan, so he just stood there as a spectator, watching the bidding competition among the major companies.

Unexpectedly, the 21.7% stake in Qiaolian Real Estate Company became the first item with a premium of more than 4%, and was selected as the most attractive item in the auction.

When the Qichang Fire and Marine Insurance Company appeared at the auction, it was already the 29th lot. It was one of the most valuable assets among the many lots and attracted the attention of many bigwigs.

".The starting price for 46% of the shares of Qichang Life Fire and Marine Insurance Company is HK$2 million. Each bid must not be less than HK$3 million. The bidding starts now! Bang!"

The first bidder was Swire Group, which offered a price of HK$2 million.

The second was New Zealand's Bailey Group, which bid $2 million.

Luo Qihong thought for a moment, then raised his sign and shouted, "2 million!"

Of course, such a bid would not scare off the consortiums, but it could clear out some small and medium-sized companies that were just joining in the fun. Soon, the Bailida Group followed suit, exceeding the price by 2 million yuan.

"Qichang Life Fire and Marine Insurance Company is very popular." Chen Zhilong sighed beside him.

Cheng Jianshen pondered and said, "This is a multinational insurance company. Its business scope has already been established. If we swallow up the entire company now, we can get our investment back in less than three years. Naturally, someone will rush to grab it."

"The market value of Qichang Fire and Marine Life Insurance Company in Hong Kong is not high, but it has branches in the UK, Australia and many countries in Southeast Asia. The market value is definitely not as low as it appears. It should be 2 to 3 times higher, which means that the actual market value exceeds HK$15 billion." Kang Wenyi said indifferently.

Originally, they wanted to take over the Qichang Life, Fire and Marine Insurance Company, so they naturally conducted a detailed investigation and knew the company very well.

After half an hour of bidding, Luo Qihong finally bought it for HK$3 million, with a premium of about 3%, making it the item with the highest premium so far.

Seeing that the insurance company was so popular, the auctioneer, with the instruction of the organizer, auctioned 50% of the shares of the New Zealand insurance company in advance, hoping to take advantage of the remaining popularity to sell it at a high price.

Unfortunately, it did not go as planned. This insurance company was indeed popular, but not as popular as Qichuang Life Fire and Marine Insurance Company. Moreover, most of the bidding companies were foreign companies, and there were only three or four local companies.

It was finally sold to a Malaysian group for HK$4 million.

Heavyweight treasures are always presented as the finale to arouse the interest of buyers.

".Next is the last lot of our auction, and also the most valuable lot of the entire auction, the Grade A commercial building in Central, the Golden Gate Building."

"In 81, the Golden Gate Building was sold for a high price of HK$16 billion. Considering that the price was too high and the auction house required cash settlement, the auction house decided to sell it in layers."

"This will take care of most companies and achieve the purpose of the auction. It's a good way to get the best of both worlds. However, some floors have better locations and some have slightly worse ones, so the prices will be different. I hope you don't mind."

"Okay, let's not waste any more time, and start auctioning the first and second floors of the Golden Gate Building. These two floors are shops, so the price will be a little higher. The starting price is 1 million yuan!"

Many people are eager to try, including small real estate companies, who seem to be waiting for the auction of the Golden Gate Building.

"Boss, this price is comparable to the price that Chen Songqing paid for the Golden Gate Building from the Hong Kong Land Development in 79 and 80 for HK$9.98 million. Although the commercial buildings in Central have only dropped by 2% to 3%, it shouldn't be such a high price." Cheng Jianshen looked a little unhappy, and he seemed to be not going to bid.

"It's really rare to see a Grade A commercial building for sale in Central. The people at the auction are well aware of this, so they dare to set the starting price so high." Luo Qihong looked around and said, "Look, they are still so happy even though they know the auction wants them to be 'water fish'."

"What about us?" Cheng Jianshen asked, "Are we still going to participate in the bidding?"

Luo Qihong thought about it, then sighed, "It depends on the situation. If the price is too high, just give up. There is no need to buy high-priced goods at this time. If the price is too high, there will not be much profit."

"Yes!" Cheng Jianshen nodded. Chen Zhilong and Kang Wenyi remained silent because the boss had already made the decision.

"5 million!" While Luo Qihong and the others were talking, the auction price actually soared to this high level.

In the end, the two floors were sold for 2 million yuan, with an average premium of 5%, which was higher than the premium of most items.

By the end of the auction, Bank of America won 9 floors of the Golden Gate Building and obtained the right to rename the building, while the other office buildings fell into the hands of different owners. The auction earned HK$10 billion from the Golden Gate Building, with an average selling price of HK$7 million per floor.

This price is 80 million yuan higher than the price that Chen Songqing paid for it in 7, with an average price of 2 million yuan per floor. It can be seen how good the market is for Grade A commercial buildings in Central.

"Sure enough, it's a little more expensive than the peak period in the 80s. These people are really crazy." Cheng Jianshen said in a low voice unwillingly.

Luo Qihong smiled and said, "If we sell Dongchang Building, I'm afraid we can make a small profit. A good location is king."

"Boss, are you willing to give it up? Dongchang Building is the most valuable property of Zhaoan Real Estate." Chen Zhilong joked to Luo Qihong with a smile.

Luo Qihong waved his hand and said, "Of course I'm reluctant. If the company has sufficient funds, I would like to buy a high-quality small or medium-sized building in Central to increase the company's asset value. But now it seems that the commercial buildings in Central are going to increase a little bit."

The next morning
The headlines of all major newspapers were all about the auction of the Golden Gate Building, and some newsprint contained comments on the lawsuit.

These news boosted the confidence of real estate developers to a small extent. After all, the auction price of the Golden Gate Building was no lower than the market price in 80, which meant that foreign companies still had confidence in Hong Kong's real estate industry, and the largest buyer was Bank of America.

American banks in this era played a strong role in guiding the trend, so newspapers and magazines analyzed this phenomenon, causing the attention to real estate to soar to a high level again.

Wheelock Corporate Office
Cheng Yutong and his son and Luo Qihongqi sat on the sofa, and steam rose up, adding some moisture to the office.

"Ah Hong, I saw that you bought the shares of Qichang Life, Fire and Marine Insurance Company at the auction. Are you planning to enter the insurance industry?" Cheng Yutong asked with a smile.

Luo Qihong smiled and responded, "Qichang Life Fire and Marine Insurance Company has good business, which is a good business plate for expansion and fits my current development plan."

"I see you have been eyeing this company for a long time?" Cheng Yutong said half-jokingly.

"Haha!! Nothing can be hidden from Uncle Tong's eyes. That's right, I had already set my eyes on this company last year, as well as the Thailand Rama Tower company that Zhaoan Real Estate Company bought." Luo Qihong admitted it directly and readily.

"The investment company plus the insurance business is indeed more stable than real estate." Cheng Yutong nodded. He had to admit that Luo Qihong's vision and strategy were really good and not as reckless as the outside world said.

Zheng Jiachun felt quite pressured. His father seldom spoke so highly of others. He used to think that he was blinded by Luo Qihong's achievements, but now it seems that Luo Qihong is really amazing.

"Uncle Tong, your Chow Tai Fook jewelry is also very good. Recently, Japanese people like to come to Hong Kong to buy gold jewelry. You must have made a lot of money." Luo Qihong complimented in a joking tone.

Cheng Yu-tung is a straightforward person. He said, "We made a lot of money from the Japanese. The yen appreciated, and those Japanese had money but nowhere to spend it, so they gave it to us."

After chatting with Cheng Yu-tung and Cheng Jia-chun for more than half an hour, we finally got down to business.

(End of this chapter)