Hong Kong 1980: The Savage Era

Chapter 288 289 [Impact on the Department Store Industry]

The next morning
As soon as the stock market opened, the Hang Seng Index began to fall. There were many rumors in the market about other companies relocating their registrations, and even Siu On Real Estate Company was not spared.

Today, the market value of Zhaoan Real Estate Company is stuck at 7 to 8 million yuan. Such rumors have actually caused the market value to drop a little, to just over 3 million yuan. Compared with its peers, it is still very strong.

This is all thanks to the fact that when acquiring Wheelock Group, the media conducted an in-depth investigation into Luo Qihong and wrote about his many industries, claiming that Luo Qihong's assets exceeded 40 billion yuan. Zhaoan Real Estate and China Gas Company were just the industries that were displayed on the surface, and the asset value of the unlisted industries was no less than that of the listed ones.

In addition, the liabilities and assets of Zhaoan Real Estate Company are still good, so it has not been greatly affected.

At the same time, the acquisition battle between Li Jiacheng and Cable & Wireless came to an end. Li Jiacheng won a narrow victory, spending 30 billion yuan to control 51% of the telephone company's shares, making it a subsidiary of Hutchison Whampoa.

At this point, the era of British capital dominance is gone forever, and the era of Chinese capital has arrived.

Luo Qihong successively acquired British-owned industries such as China Gas and Wheelock, and stepped onto the top of Hong Kong's business world. Compared with Li Zhaoji's Electric Light Company and Star Ferry Company, Li Jiacheng's Qingzhou Cement Company, Hilton Hotel, Hutchison Whampoa, and Telephone Company, he was naturally at a clear disadvantage.

However, it is already remarkable that Luo Qihong has narrowed such a huge gap in just 4 years. He has always been described as a new generation of business leader by Hong Kong media, and even a genius like Luo Xurui has to be inferior to him.

Dao Heng Bank Boardroom

Although it was called a board meeting, there were actually only six people attending, including Quek Lingcan's brothers. Luo Qihong was alone, and the remaining four were Quek Lingcan's confidants.

However, Luo Qihong did not mind this. Daoheng Bank was the Guo family's base in Hong Kong. It was already a great honor for them to let him attend the meeting. He was not interested in the bank for the time being.

"Everyone has read the plan. The bank's deposits have exceeded 10 billion Hong Kong dollars. If this money remains in the account and is not handled in time, it will generate a lot of interest. So I suggest that this money be lent to the parent company to carry out the acquisition." Guo Lingcan glanced at everyone and said with a smile.

"Mr. Guo wants to acquire Youlian Bank? Did the inspiration come from the 10% stake of Youlian Bank at the auction?" Luo Qihong asked seriously.

Guo Lingcan smiled and said, "Nothing can be hidden from Luo Sheng's eyes. If we acquire Union Bank, the company will move to a higher level and its position in Hong Kong will be more solid."

Luo Qihong pondered for a moment and said, "Mr. Guo works in a bank, so he should know some tricks. As far as I know, although the current Youlian Bank looks very prosperous on the surface, its internal management is actually a bit chaotic and has many problems. Shouldn't we change our target?"

Guo Lingcan responded, "I know these problems. They are not big problems. We can solve them by transferring some people from Daoheng Bank."

"I think we should first understand the account situation of Union Bank and not rush to acquire it." Luo Qihong said, "The current financial industry is not very good. Judging from the bankrupt banks, they all have a large number of bad debts. Union Bank may also have such problems, but they have not been exposed yet."

"I don't know much about the banking industry, but I have some experience in the operation of listed companies. I feel that Union Bank is by no means simple. On the contrary, I am interested in Hang Lung Bank, which has been taken over by the Hong Kong government."

Those confidants looked at Luo Qihong one after another, and seemed to be interested in Luo Qihong's suggestions.

The depressed director said, "Mr. Guo, I think what Mr. Luo said makes sense. Hang Lung Bank has the Hong Kong government as a guarantor, so the problem should be almost solved. Besides, the business volume is not low. Compared with the unknown situation of Union Bank, this is more suitable for us."

Guo Lingcan didn't want to give up his plan, but he had already fallen into a disadvantage, so he had to stop for the time being.

"There is no rush for this matter, we can take our time. Currently, we are the only one that dares to actively launch acquisitions, while other peers are consolidating their own positions or waiting for the market to improve."

"But we need to find a way out for our bank deposits as soon as possible. What do you think we should do with them, Luo Sheng?"

Luo Qihong smiled and said, "If Mr. Guo really can't find a direction, he can lend the funds to my company. I just hope the interest rate will be lower."

"How about 7% interest rate?" Guo Lingcan seemed to know that Luo Qihong would talk about borrowing money.

Luo Qihong smiled and said, "Okay, then I'll loan you 7 million."

This number made Guo Lingcan's pupils dilate slightly. Luo Qihong was indeed very powerful.

"No problem, then 7 million." Guo Lingcan said, "Luo Sheng is indeed a famous tycoon in Hong Kong. He swallowed up so much money in one go."

Luo Qihong quickly said a few humble words, this money was just enough to make up the funds for the acquisition of Lane Crawford Development Company.

"The next topic is to expand the foreign currency exchange business for tourists. Hong Kong's tourism industry has been booming recently, especially the Japanese, who like to go shopping in Hong Kong and need to exchange a lot of Hong Kong dollars."

Luo Qihong did not comment. This was an unnecessary topic. Even a fool could tell how to do the business of exchanging Hong Kong dollars, and it could certainly be expanded.

After the directors expressed their opinions, Guo Lingcan said, "Many financial companies, individuals, and banks are doing this business. We don't have any advantages. Please give us some suggestions."

“You can use low prices to attract redemption guests.”

"By connecting with travel companies, we can give them some benefits on the exchange rate."

Seeing that Luo Qihong was silent, Guo Lingcan asked, "Does Luo Sheng have any good suggestions?"

"These tourists come here to shop and are attracted by the duty-free convenience of the Hong Kong Free Trade Port. We can set up some currency exchange shops in prosperous areas to facilitate these tourists to exchange money. The exchange rate should be higher than that of banks, so as to achieve small profits but quick turnover." Luo Qihong continued, "Others can open travel companies, so why don't we go directly to Japan to cooperate with those travel companies or open a company ourselves to reduce the price difference earned by middlemen."

Guo Lingcan nodded and said, "Luo Sheng's suggestion is very good. Let's do it according to this plan and complete it as soon as possible."

After the meeting at Daoheng Bank, Luo Qihong returned to Dean Securities Investment at around 4 p.m., and the stock market had already closed.

"Ah Hong, today's Hang Seng Index fell 61.67 points, a drop of 5.5%." Bai Jinyan handed over a thin document.

"Hmm!" Luo Qihong glanced at the document, straightened his coat, sat down, and picked up the document to read.

"The power is comparable to that of a small missile. It's worthy of being Jardine Matheson. It would be great if our company could have such a great influence in the future." Luo Qihong was not surprised at all. Perhaps he had experienced the crash in 82 and was accustomed to scenes of drops of hundreds of points.

"Even some blue-chip stocks have fallen by between 1% and 2%, and the share prices of small companies have plummeted," Bai Jinyan reported on the overall situation of the stock market.

Luo Qihong thought for a moment and said, "How much money do we have to buy at the bottom?"

This is probably the last big drop in 84. The stock market will rise slightly next, and at worst it will not fall sharply.

By the second half of the year, the outcome of the China-UK negotiations will be clear. At that time, capital will flow into the stock market in large quantities. It would be hasty to buy at the bottom. Now we can make choices and make plans calmly.

"About 1 million Hong Kong dollars." Bai Jinyan answered somewhat dejectedly.

All the funds that De'an Company recovered from Hutchison Whampoa and Hong Kong Television Broadcasting Corporation stocks went into Luo Qihong's personal pocket. He acquired 50% of the shares of Zhengluo Company and repaid a batch of debts.

Luo Qihong now has HK$13 billion in personal funds, which may seem like a lot, but it will be difficult to implement according to the plan. Luo Qihong nodded slightly, "1 million is 1 million. Now the stock prices of many companies are very low. I can buy a large number of stocks. In the second half of the year, I will transfer some funds back from the Japanese market to buy at the bottom."

"Approximately how much will it be adjusted? I can also be prepared and sell some stocks that have not performed well." Bai Jinyan asked.

"About 75 billion yen (3 million Hong Kong dollars)." Luo Qihong said lightly.

As the Hong Kong market warms up, Luo Qihong is unlikely to continue to invest most of his funds in Japan, otherwise it would be putting the cart before the horse, and the profits from the Japanese market may not be more than those from the Hong Kong market after its recovery.

What’s important is that the Plaza Accord in 85 could bring him huge profits, and solving all his financial difficulties would not be a problem.

The Deep Water Bay villa area was pitch black at night, and the sound of waves could be heard from the sea in the distance.

The newly opened electronic component manufacturing company has been put on track, and the Chen family has calmed down. Chen Zengjing decided to purchase goods from the new company to help his second son.

However, Luo Qixing seemed to have no interest in the electronic components company. He handed over the affairs and power of Qianheng Electronics Company (electronic components company) to Chen Yusan, and concentrated on running the printing company and acquiring low-priced properties.

Luo Qihong was helpless and could only help occasionally to prevent them from facing bankruptcy.

The three chatted for a while, and the topic gradually changed to business.

"Jardine Matheson has relocated its registration, and the next should be Swire Properties. Is the Hong Kong market really in trouble?" Chen Yusan asked herself with a self-questioning sigh.

Luo Qihong closed his eyes and listened to the sound of the waves, thoughts churning in his head. Chen Yusan was not the only one who thought this way, she was just one of them.

In fact, this is a habitual thinking pattern.

Jardine Matheson has been the leader in Hong Kong for too long. Some people habitually follow Jardine Matheson and study its actions, but they forget that there are many differences between British capital and Chinese capital, and the distinction between British capital and Chinese capital should be added before the study.

Of course, after the China-UK negotiations are over, many companies will still relocate their registrations, simply because they are worried about emergencies and want to facilitate companies' overseas investment.

Luo Qihong grinned and said, "My company will not consider relocation for the time being. Dean Securities Investment Company will clean up some of its investment projects in Japan this year and withdraw funds to bet on Hong Kong's stock market and local cities."

"As for what you guys want to do, I won't interfere. It's your own choice. If you lose, you have to bear the consequences yourself."

In previous lives, many people immigrated overseas between 83 and 85, but the business environment overseas was far inferior to that in Hong Kong, and they simply could not stand it, so many people returned to Hong Kong to continue doing business. However, there was not much room for them in Hong Kong at that time.

Luo Qihong thought he had been good enough to Luo Qixing and Chen Yusan. He had helped them build up the family business. He couldn't support them all their lives, and they didn't want him to support them all the time.

In this case, Luo Qihong could only let them make their own judgment. Whether or not to follow was their own business.

Even Luo Qixing noticed the changes in Luo Qihong and guessed that it was the sequelae of his unauthorized entry into the property business last time.

Chen Yusan glanced at Luo Qixing, asking for his opinion or asking him to say something good.

"When the market improves, I want to integrate the paper company, printing company and some properties and list them on the stock market. I want to use the funds raised to expand the company. I'm learning from the approach of Legu Real Estate Company." Luo Qixing ignored Chen Yusan's eyes and expressed his plan, intending to ask Luo Qihong.

Luo Qihong asked, "Is it a backdoor listing?"

"Well, there are too many procedures for direct listing. If the backdoor listing is handled properly, there will be no loss to us. It just requires a large sum of money to buy the shell." Luo Qixing replied.

"It's not easy to learn the way Legu Real Estate Company did. Cui Baiquan built his business by taking advantage of the great disaster in 73 to purchase three small commercial buildings in Central. The gap between them is quite large," Luo Qihong reminded.

Luo Qixing did not want to admit defeat. "There are big ways to do big things and small ways to do small things. The property rental business can be done for a long time. As long as you do things steadily, there shouldn't be any big problems."

"Or should we go the route of 'Shop King'?" Luo Qihong asked.

"Almost. If there are other good properties, I will also acquire them, but I won't develop the land." Luo Qixing has carefully studied the history of Legu Real Estate Company and believes that it is also suitable for him.

The two brothers chatted with each other, allowing Chen Yusan to slowly adapt to this strange atmosphere.

As April approached, the weather became increasingly strange, sometimes cold and sometimes as hot as summer, so many people caught colds.

Hong Leong Investment Company acted quickly and completed the preparations for the new company. Its travel company in Japan was also ready to cooperate with its peers to develop Hong Kong's tourism and shopping business.

Dao Heng Bank quickly established exchange points in Central, Kowloon, Wan Chai and Causeway Bay, with the help of Siu On Real Estate Company. The shops opened were all in excellent locations to prevent their business from being snatched away by other banks and financial companies.

Wheelock Properties and Hop Cheung Trading Company held a press conference and announced that they would sell their Lane Crawford Development Company to Hop Cheung Trading Company for HK$6 million.

"Mr. Luo, is this a 'left-hand deal'?" The female reporter wearing black glasses stood up and asked.

Luo Qihong had guessed that there would be such a question, and replied with a smile, "Wheelock Company is now in debt of nearly 30 billion yuan (it's easier to exaggerate), and it is difficult to recover by selling ships alone. We can only sell some other assets."

"Although I am the executive director and general manager of Wheelock, I cannot but implement the resolution of the board of directors. This acquisition has been agreed by all directors of the board of directors."

"Excuse me, in the past two years, Hexiang Trading Company has been making great strides in the trading industry. Will it change its business direction after acquiring Lane Crawford Development Company?"

"No, Lane Crawford Development Company's business model is already very mature." Luo Qihong answered affirmatively.

"He Xiang Trading Company follows the low-end and mid-range trading route. Will it help Lane Crawford expand its scale and enter the low-end and mid-range department store market?"

"Lane Crawford will continue to develop along the high-end department store route, but Hexiang Trading Company will enter the mid- and low-end department store market." Luo Qihong said with a smile.

After a press conference, Luo Qihong was severely exhausted. It must be said that dealing with these reporters was more tiring than working for a whole day.

Reporters are always trying their best to make the parties make mistakes in their words so that they can have news to write.

Once the news spread, many department stores paid special attention to it.

Luo Qihong is a powerful opponent. His announcement of entering the mid- and low-end department store market is bound to cause a bloodbath.

(End of this chapter)