My Realistic Simulation Game

Chapter 132 Use Ochakov's money to buy Ochakov!

Qin Yuan was not familiar with the process of obtaining mortgage loans from Soviet banks.

However, I also know that for any loan involving large sums of money, it is necessary to have an independent actuary conduct a professional appraisal of the collateral.

An objective and authoritative valuation report is the key to unlocking bank funds.

The person in front of him was exactly the professional talent he needed right now!

Actuaries can transform their hard-to-quantify brands, networks, and formulas into hard currency value recognized by banks!
but.
Qin Yuan turned his gaze to the face that looked like it could bring ruin to the country, looking directly into the woman's deep blue eyes.

"Miss Shayk, I'm curious, why did you offer to help me?"

Upon hearing Qin Yuan's question, Elena Shaik's lips curled into a charming smile: "Because I'm also very curious about Mr. Qin."

"I'm curious how you, a Chinese person, were able to make a name for yourself in the Soviet Union so quickly."

"I'm curious about the speed of the rise of Far East trade, and I'm curious about your own business strategies."

“And nothing satisfies my curiosity faster than observing the operation of Far East trade up close, and observing you yourself.”

Qin Yuan was not swayed by her beauty. His gaze was fixed on the "enchantress" before him: "Just out of curiosity?"

Elena Shaik smiled without any hesitation: "Of course, I think you might be a good source of material for my graduate thesis."

Upon hearing the word "materials," Qin Yuan extended his hand, formally extending an invitation: "Miss Shayike, I am Qin Yuan, the head of Far East Trade."

“If you don’t mind the crowded train, I’d like to invite you to join me to discuss in detail our financial difficulties and possible solutions.”

He never believed in kindness without reason.

But in this world, there exists an exchange of equivalent value.

A barely perceptible glint flashed in Elena's eyes at Qin Yuan's nonchalant attitude. Without the slightest hesitation, she opened the car door and gracefully sat in the back seat.

Natasha followed closely behind.

The Lada car started again and drove away from the campus.

Soon, the group arrived at the Chekhov Hotel.

Here, Qin Yuan wasted no time and cut straight to the point: "Miss Elena, time is of the essence, so I'll get straight to the point. Far East Trade plans to acquire the Ochakov Beverage Factory, with an estimated acquisition price of 100 million rubles. We currently have about 40 million rubles in cash available, leaving a shortfall of 60 million rubles. We need to apply for a mortgage loan from the Moscow State Bank using our existing assets."

"I need you to assess the maximum loan amount that our existing asset portfolio can leverage, and how to package it in a way that will be acceptable to banks."

He quickly listed the assets that could be mortgaged: the Khabarovsk Kvass plant, the assets of the Far East Trade Moscow branch, Far East Kvass, the Tsar Kvass brand and formula, the Jeanswest brand and sales network, and some fixed assets.

Then, Natasha and Magan'er were asked to produce a series of supporting documents.

Elena put on a pair of frameless glasses and carefully examined the pile of documents and accounts in front of her.

Qin Yuan wasn't in a hurry; he just watched quietly and waited for the result.

About half an hour later.

Elena finally stopped searching and calculating.

She didn't answer immediately, but tilted her head slightly and looked at Qin Yuan with a smile: "Mr. Qin, your vision is truly accurate. If you succeed in acquiring a beverage factory like Ochakov that has been submerged in history, your assets and the scale of your businesses will expand dramatically."

Qin Yuan felt no emotion upon hearing these words.

If his assets weren't expanding, why would he go to such lengths to acquire such a Soviet factory?

“Miss Shayk, I want to hear your exact answer.”

Elena Shaik smiled slightly, then became extremely professional: "Loan assessment hinges on the 'acceptability' and 'value stability' of the collateral."

"Moscow State Bank prefers physical assets, especially heavy industrial equipment and real estate. Intangible assets... have very low recognition."

She spoke quickly and clearly: "The Khabarovsk Kvass plant is the core collateral, along with the equipment list you provided, the plant's property title certificate, the land ownership or long-term lease documents, and the existence of Far East Kvass."

"I estimate that, under the best-case scenario, the factory's maximum mortgageable value is approximately...2500 million rubles."

"Then there are the fixed assets of the Far East Trade Moscow branch, most of which are of limited value and mostly movable property with low mortgage rates. The packaged valuation is optimistically estimated at no more than 500 million rubles."

"As for the intangible assets of brands like Jeanswest and Tsar Kvass that you mentioned," Elena shook her head slightly, "I'm sorry, Mr. Qin. The Soviet banking system had almost no valuation models for intangible assets such as brands and goodwill, and lacked market transaction references."

“Unless you can provide stable, verifiable high profit flow based on the brand over the past three years, the bank’s valuation… is likely to be zero.” Qin Yuan’s heart sank.

The Khabarovsk factory costs 2500 million, plus 500 million for miscellaneous items, totaling only 3000 million!
We're still halfway to reach the 6000 million shortfall!
"Only 3000 million?" Qin Yuan's voice was slightly hoarse. "That's far from enough!"

Seeing Qin Yuan's furrowed brows, Elena said calmly, "Mr. Qin, don't rush. This is just a conservative assessment based on 'existing assets.' The acquisition itself is the biggest leverage!"

She leaned forward slightly, her sharp edge revealed: "The Ochakov beverage factory itself is a huge gold mine!"

“It is located near Moscow, covers a huge area, and its land value far exceeds its net book value, making it the strongest collateral!”

"Although some equipment is aging, the overall production capacity and technological foundation remain, and its valuation is not low. In particular, its 'special supply' level beverage production qualification has extremely high administrative barrier value and potential cash flow guarantee under the current system."

“My suggestion is—” Elena quickened her pace: “A two-step strategy!”

"Which two steps?" Qin Yuan immediately pressed.

His eyes were filled with a hungry thirst.

"Step 1: Lightning Acquisition!" Elena extended a slender finger, looking directly into Qin Yuan's aggressive gaze: "Use your existing 40 million in cash, plus the mortgage loan from the Khabarovsk factory, to raise 60 million as a down payment, finalize the acquisition agreement with the Ministry of Trade and the Industry Bureau, and complete the transfer of ownership!"

"Step Two: Reverse Mortgage!"

She held up her second finger: "Once we obtain the property certificate for Ochakov, we will immediately use all the assets of the newly acquired Ochakov beverage factory as collateral to apply for a second loan from the National Bank. This loan will be used to repay the short-term bridge loan from the first loan and to supplement working capital!"

She looked intently at Qin Yuan: "The land and qualifications of Ochakov are far more valuable than those of the Khabarovsk factory!"

"If handled properly, the amount of the second loan could very well cover or even exceed that of the first one!"

"This is a classic example of a leveraged buyout (LBO)! Using the target company's assets to finance the acquisition of itself!"

Qin Yuan's eyes suddenly flashed with an amazing light, as if he had seen a lighthouse in the darkness!
Leveraged buyout: Use Ochakov's money to buy Ochakov!
That's a great idea; it's exactly the solution he needs.

"How feasible is it?" Qin Yuan immediately asked.

Elena calmly analyzed: "The key lies in two points: first, the speed of raising and settling the down payment, and second, the approval of the second loan."

"We must complete the transfer of ownership of Ochakov and get that piece of paper before the banks react or before the policies change!"

"This requires strong government backing and banking relationships!"

Hearing this, Qin Yuan felt much more at ease.

He already has the government's endorsement.

The promises from Director Motolov of the Ministry of Trade, and from that shadowy figure in the Industry Bureau.

They received benefits and money, so they were obligated to do things.

Through currency exchange, he had already created a small loophole in the banking relationship.

Doing other things might be difficult, but helping with this kind of thing is still possible.

Qin Yuan immediately replied, "Don't worry about that. When the bank assesses Ochakov, it will recognize the land value and qualification premium."

Upon hearing this, Elena was visibly taken aback, but she didn't delve into it further. Instead, she added, "That would be for the best. The only risk of this leveraged buyout is that if the second loan is not approved or the amount is insufficient, we will face enormous short-term debt repayment pressure and may even lose the Khabarovsk factory!"

"Therefore, this second step must be planned in advance."

Qin Yuan remained silent for a moment, his eyes calm and still.

The risks are huge, but the rewards are even greater!

Once Ochakov is captured, Far East trade will be completely transformed, becoming an industrial giant rooted in the heart of the Soviet Union!
The production capacity bottleneck of Tsar Kvass will no longer exist, and the brand influence of Jeanswest will also achieve a qualitative leap through the physical factory!

“Miss Shayik,” Qin Yuan looked at her, his eyes filled with admiration and decisiveness, “your proposal is worth a fortune!”

"Now, I need you to do two things for me: First, immediately begin preparing a detailed asset appraisal report for the Khabarovsk plant. It needs to be professional, rigorous, and impressive enough to impress the bank!"

"Secondly, I would like to meet your mentor. If possible, I would like to ask him to help ensure the green light for the second step of loan approval!"

Elena smiled confidently. "It would be my pleasure, Mr. Qin. However, my professional consultations are not cheap."

Qin Yuan laughed loudly: "As long as we can get Ochakov, you dare to name your price, and I dare to pay it!"

(End of this chapter)