Hong Kong 1980: The Savage Era

Chapter 400 [Miramar Hotel]

"I want Chinese Estates Holdings to slowly absorb about 8% of the shares of large hotel groups from the stock market. If Chinese Estates Holdings lacks funds, it can take out a loan and I will bear the interest incurred. No matter what the stock price is in the future, I will buy it back at a 2% premium," said Luo Qihong with a smile.

"Mr. Luo, can I know the reason?" Liu Luanxiong didn't disbelieve Luo Qihong, but he felt that the matter was very strange.

So, Luo Qihong told the Kadoorie family about the agreement and the possibility of breaking the agreement.

"Okay, that's no problem. Chinese Estates will get the advantage anyway." Liu Luanxiong laughed heartily.

Not only can he make a profit, but he can also make Luo Qihong owe him a favor. It's a win-win situation.

"Mr. Luo, you have dealt with the Yang family of the Miramar Hotel. Do you think I have a chance?" Liu Luanxiong suddenly asked.

Luo Qihong was slightly stunned. The controlling family of Miramar Hotel is the Yang Jingyun family. This family is an old friend of Li Zhaoji. In the previous life, Li Jiacheng and CITIC Fortune launched an acquisition of the hotel, but were intercepted by Li Zhaoji.

Miramar Hotel, formerly known as Miramar Hotel Enterprises, was listed in 70. In 81, when Hong Kong's real estate was at its peak, it sold 8.6 square feet of land in the old wing of the Tsim Sha Tsui Hotel to Carrian Properties for HK$28 billion.

It caused a sensation in Hong Kong at the time and was also reported internationally.

Later, when the Sino-British negotiations took place, the real estate market collapsed and the Carrian Company went bankrupt. However, the Miramar Hotel still received an advance payment of 9.24 million yuan and compensation of 3.75 million yuan from the Hong Kong Land Development, and the old wing land is still in the hands of the Miramar Hotel Company.

Today, the luxurious Park Lane Plaza and Kewon Building have been built on the old wing site, with a total floor area of ​​103 million square feet, making it one of the company's most valuable property assets.

However, since Yang Zhiyun passed away in 85, Miramar Hotel Enterprises has lost its former glory. Its management style has become increasingly conservative and its business has begun to decline. Its profit last year was only 1.2 million yuan.

It is much weaker than similar companies, but its successors still do nothing.

The Yang Zhiyun family holds a 34.6% stake in Miramar Hotel Enterprises through a family trust fund and a family investment company, which means that if they want to take over Miramar Hotel Enterprises, they must acquire it in full.

"The Miramar Hotel belongs to the Yang Jingyun family, and this family also runs the Xiangjiang Jingfu Jewelry Company. There won't be too many financial difficulties, so the acquisition is not easy." Luo Qihong shook his head.

"Unless the Yang Jingyun family is willing to sell, it will be difficult for you to acquire it successfully, and Li Zhaoji is hiding behind it."

The scale of Jingfu Jewelry Company is smaller than that of Chow Tai Fook Jewelry, but the gap is not big. Its annual profits are very considerable, especially since the appreciation of the Japanese yen in 85. Its profits are comparable to those of large real estate companies.

Liu Luanxiong was obviously very clear about this, so he asked Luo Qihong.

Liu Luanxiong said, "Since Yang Bingzheng took over the Miramar Hotel, his prestige has been far from that of Yang Jingyun. He has been greatly constrained in management and has to make concessions every time."

"Now that they can't raise funds through share offerings, they still need to pay huge dividends every year. This year's dividends account for 82% of profits. This is why Miramar Hotel is conservative."

"There are also many elderly directors who are selling their shares and cashing out at high prices. Chinese Estates Holdings already holds a 16.3% stake in Miramar Hotel."

Liu Luanxiong's words surprised Luo Qihong. He didn't expect that this guy had already taken action, and he did it when the Chinese Estates Company did not have sufficient funds.

I really don’t understand what Liu Luanxiong is thinking. Isn’t he afraid that the Chinese Estates Company will be on the verge of bankruptcy?
"So you want me to help you?" Luo Qihong asked. "Mr. Luo, can you help me block Li Zhaoji when he intervenes?" Liu Luanxiong stared at Luo Qihong seriously.

"Liu, the market value of Chinese Estates Holdings has reached 50 billion yuan. You can't keep sniping at it. Reputation is very important for a businessman, so I hope that the directors of Miramar Hotel will invite you to acquire it, rather than others." Luo Qihong expressed his attitude.

"Okay, no problem!" Liu Luanxiong agreed of course, he also wanted to do this.

"As long as Li Zhaoji intervenes, I will definitely help you, but I still advise you to talk to Yang Bingzheng's family. Acquisition at a high price will not be a problem." Luo Qihong said.

Miramar Hotel and Investment Company is already a high-quality company with its property in Tsim Sha Tsui, not to mention its other hotel properties.

According to Luo Qihong, the Miramar Hotel in Shekou, Pengcheng has been completed, with a market value of several hundred million yuan. It also has some scattered properties, and its asset value has reached 73.5 billion yuan, which is still very conservative.

Therefore, Miramar Hotel Enterprises is better than Luo Xurui's Regal Hotel.

The Guo Zhiquan family spent a huge amount of money to buy back a large number of properties from the Cheng Yutong family, while the Cheng Yutong family only took away two commercial buildings of Wing On Company in Central and the Wing On Center Building in Sheung Wan.

In order to change the status quo, the Guo family has cooperated with Japanese companies in the department store industry, which has seen some improvement and now occupies 7% of the Hong Kong department store market.

Although it is still several times lower than its peak period, it is a significant improvement compared to the previous 2% and 3%.

Luo Qihong's Rocks Department Store also occupied 4% of the Hong Kong department store market, bringing considerable profits to Hexiang Trading Company every year.

This was the result Luo Qihong achieved without putting much effort in the department store industry, so he was quite satisfied with it.

After all, in Hong Kong's department store industry, Wellcome Supermarket under Dairy Farm International and ParknShop under Hutchison Whampoa's Watsons are already two giants, accounting for more than 5% of the market share.

As a newcomer, it is not easy for Rocks Department Store to capture such a market share.

"Mr. Luo, the supermarket model has become the trend in the department store industry today. Are we keeping up?" said He Zegui, deputy general manager of Rocks Department Store.

Luo Qihong seldom comes here for meetings. This time he showed up because of the company's strong request.

“We can try opening a few small supermarkets first. If the model is suitable, we can invest heavily to seize the market.” Luo Qihong said calmly.

He certainly knew that supermarkets were the trend of the future and the previous department store model had been eliminated by the market. However, the two supermarket giants were still fighting, and he did not have much money to join in, so he could only try to enter on a small scale.

"Mr. Luo, I don't think we need to test the market's reaction anymore, because Wellcome and ParknShop have already gotten the market's answer for us." He Zegui said, "We should invest heavily to open up the market and seize the market."

"Where does the money come from? If I remember correctly, the company made a profit of 3700 million yuan last year, and the net profit was only 2600 million yuan." Luo Qihong didn't want to be led by his subordinates.

(End of this chapter)