Rebirth in Hong Kong: From Dessert Shop to Industrial Empire

Chapter 219 Foundation Laying (Seeking monthly votes, recommendations, and subscriptions!)
Xie Jianming, holding the fund transfer slip signed by Chen Bingwen, strode back to the investment department.

He felt his heart beating a little fast, not from nervousness, but from excitement.

Two hundred million Hong Kong dollars, leveraged three times, with a target of gold price trends over the next six months.

This level of investment is absolutely top-notch in today's Hong Kong Chinese-owned business circles.

He glanced at the calendar on the wall; today was July 23rd.

Mr. Chen demanded that the HK$200 million gold position be established by August.

time is limited.

"Qiang, Jie, come here for a second!"

Xie Jianming did not sit down, but directly called over the two most capable traders in the department.

"Mr. Chen approved a large sum of money to invest in gold. He wants us to put in an equivalent position of HK$600 million as quickly as possible."

Xie Jianming succinctly conveyed Chen Bingwen's instructions.

Such a large amount of capital accumulation made Ah Qiang gasp: "Six hundred million?"
Brother Ming, this business is too big. It's too risky to have one company handle it all.

In today's trading environment, even transmitting a quote over the phone is a beat too slow; if there's a sharp market fluctuation, you might not even be able to close your position.

Xie Jianming nodded: "Chen Sheng also thought of this. Therefore, the funds will be distributed in three ways."

After saying that, he picked up the chalk and quickly wrote three names on the blackboard next to him:
Hong Kong Gold and Silver Exchange.

Precious Metals Department, Po Sang Bank.

Merrill Lynch's futures department in Hong Kong Island.

"Ah Qiang, you're in charge of the trading floor."

Ah-Jie, you're in charge of Bao Sheng Bank.

I went to the futures department of Merrill Lynch in Hong Kong Island.

After writing down the names of the three gold futures brokerage firms, Xie Jianming quickly assigned tasks: "Remember, the initial capital for each firm should not exceed HK$70 million, and the total leverage should be controlled at around three times."

"Be quick, but discreet; don't set the price too high."

"Understood!" the two replied in unison, and immediately turned to make a phone call.

Gold futures trading at that time was far less convenient than it would be in later years.

There is no electronic trading platform, no one-click ordering, and no real-time, continuous global price quotes.

All instructions must be sent through telephone lines, via traders or brokers, to enter the market.

The process is slow and involves many steps; any problem at any stage could cause delays or even errors.

Diversifying large sums of money among three different brokers is the most practical way to control operational risk.

Xie Jianming himself was in charge of the central office, with three different transaction record books spread out in front of him, each corresponding to one of the three accounts.

He needs to coordinate the progress of the three parties to ensure that the overall cost and pace of building positions are within a controllable range.

For the next three days, Xie Jianming and his team worked like clockwork, constantly making phone calls, checking quotes, confirming deals, and recording positions.

The funds in the three accounts flowed silently into the vast ocean of the international gold market.

Because of the strategy of building positions in a diversified and phased manner, the market did not experience drastic fluctuations.

By the close of trading on July 28, the initial capital of HK$200 million had been converted into long positions in gold worth approximately HK$600 million, with an average cost of around US$258 per ounce.

Xie Jianming looked at the densely packed numbers in the three record books and let out a long sigh of relief.

The first phase of the mission is finally complete.

Chen Bingwen glanced at the position building report submitted by Xie Jianming, nodded, and didn't say anything more.

He wasn't interested in the specifics of the investment process, as long as the final result met his requirements.

"Keep a close eye on things. Report any unusual market movements directly to me."

he ordered.

"Mr. Chen, please rest assured, I have arranged for two people to be on duty to keep a close eye on international gold prices."

Xie Jianming explained.

"Okay." Chen Bingwen nodded, indicating that he could go back.

After Xie Jianming left, Chen Bingwen's attention shifted to another document on the table.

After a period of preparation, the China Resources Group's Tin Shui Wai project is finally about to commence.

This document is the detailed plan for the development of the Tin Shui Wai Phase I project that he received as a special consultant for the project.

An invitation was also included, inviting him to the groundbreaking ceremony for the first phase of the project.

In this development plan for the first phase of the Tin Shui Wai project, China Resources Group adopted almost all of his original suggestions and did not pursue an overly ambitious or comprehensive approach.

Instead, a strategy of "overall planning, phased implementation, and rolling development" was adopted.

The first phase will concentrate all resources to prioritize the creation of a core "model demonstration area," building roads, water, electricity, schools, medical stations, community centers, and a decent small commercial plaza to a high standard, so that citizens and investors can see a real prototype of the new area.

The total investment for the first phase of the project is approximately HK$12 billion.

Based on the shareholding ratio of the Tin Shui Wai Joint Development Company, Cheung Kong Holdings holds 12.5% ​​of the shares and needs to invest HK$1.5 million. Upon seeing this figure, Chen Bingwen did some mental calculations.

Even though Li Jiacheng just cashed out a sum of money in Yingni, Qingzhou, this amount is probably still a drop in the bucket for Cheung Kong's current situation.

The Tin Shui Wai project has a long cycle and a large amount of capital tied up. This investment of HK$1.5 million will firmly tie up part of Cheung Kong's cash flow for some time to come.

This is an advantageous factor for Chen Bingwen.

He picked up the invitation and looked at it; the groundbreaking ceremony was scheduled for next Wednesday.

In this situation, he would definitely have to go in person, not only because it was necessary for the project, but also because it was a good opportunity to observe the dynamics of all parties involved.

After finishing the urgent matters at hand, Chen Bingwen asked his secretary, Ali, to call Fang Wenshan and the newly hired employee, Mai Lisi.

“George, here’s some information about the Tin Shui Wai project. Take a look.” Chan Ping-man handed the documents to MacLehose. “You and I will go to the groundbreaking ceremony next Wednesday.”

Mireille quickly glanced through it, her eyes showing appreciation: "A very pragmatic development strategy."

Building a reputation and building confidence first is much smarter than blindly expanding.

What is Chen Sheng's role in this project?

“Special advisor. No shares, but some advisory rights,” Chen Bingwen said, then changed the subject, “I called you here today mainly to discuss the upcoming funding arrangements.”

As he spoke, he looked at Fang Wenshan: "Director Fang, please give us a brief overview of your company's resources."

Fang Wenshan opened his notebook and said, "Currently, the company's main funds are concentrated in several sectors:

1. After acquiring a controlling stake in Qingzhou Yingni, approximately HK$80 million was reserved in the company's accounts for operation and relocation purposes.

This portion cannot be used in the short term.

2. Chen Ji Foods and Watsons have good daily operating cash flow and can generate stable profits every month, but they need to support Ma Shimin's transformation plan for Watsons and expansion in North America and mainland China. This part of the funds also needs to be reserved.

3. Previous acquisitions of Hutchison Whampoa and Qingzhou Yingni incurred significant costs. Although the latter's share price increase brought substantial unrealized profits, the company currently has approximately HKD 300 million in liquidated cash after deducting the HKD 200 million investment in gold.

After listening, Chen Bingwen looked at Michael and asked, "George, what do you think?"

After a moment's thought, MacLehose said, "HK$300 million in cash may seem like a lot, but it's not enough to deal with the potential escalation of the Hutchison Whampoa acquisition and to support expansion on multiple fronts."

Gold investment is a potential growth area, but it is subject to uncertainty.

The immediate priority is to optimize the financial structure of existing assets, enhance overall creditworthiness, and prepare for potential large-scale financing.

“Just as I thought.” Chen Bingwen nodded. “Qingzhou Yingni is the key.”

It is now our only publicly listed company and holds prime land.

The rezoning of the Hung Hom site has been approved; the next step is to resolve the issues of land premium payment and development funding.

George, you're in charge of following up on this.

The goal is to design a financing plan that can ideally use the project's future revenue or the land itself as collateral to obtain most of the development funds from the bank, while minimizing or even eliminating the use of our own funds.

If necessary, the stock price of Qingzhou Yingni can be artificially inflated within a controllable range, allowing for buying low and selling high.

There's a lot of money available to retail investors in Hong Kong right now, so we can try to attract more funds from them.

In his previous life, Joseph Lau, the founder of Chinese Estates Holdings, manipulated the stock price five times within a year, buying low and selling high, and reaping nearly HK$300 million from retail investors.

Chen Bingwen didn't want to ruin his reputation like Liu did, but extraordinary measures are needed in extraordinary times, and it wouldn't hurt to do it once or twice.

“Understood.” Mireille immediately understood the intention. “I will study the land value and planning as soon as possible, and contact several reputable banks to explore the possibility of project financing or syndicated loans.”

“Director Fang, please cooperate with George and provide all the necessary financial data.” Chen Bingwen then turned to Fang Wenshan, “In addition, keep a close eye on Cheung Kong Holdings’ movements.”

Although Li Jiacheng only acquired 10.65% of the shares, he will certainly not be content to be a quiet shareholder.

Fang Wenshan nodded: "Don't worry, Mr. Chen, I've been keeping an eye on things."

Cheung Kong Holdings is currently advancing several medium-sized residential projects simultaneously, requiring substantial funding.

In addition to the HK$1.5 million investment in Tin Shui Wai, the office building projects in Central are also nearing payment deadlines. I heard they're currently negotiating a bridge loan with HSBC, which will probably keep their CFO quite busy.

"Hmm." Chen Bingwen nodded in satisfaction. "Just keep an eye on it."

This was exactly the effect he wanted. Li Jiacheng was too restless; only by fighting on multiple fronts and depleting Cheung Kong's cash flow could his expansion be slowed down.

A few days later, on Wednesday morning, the groundbreaking ceremony for the first phase of the Tin Shui Wai project was held.

Colorful flags fluttered in the breeze, and drums and gongs resounded.

Although the site is still a construction site, it has now been leveled and a temporary stage and backdrop have been set up, creating a lively scene of construction about to begin.

As the time drew near, guests and media reporters arrived one after another.

Zhang Jianhua, General Manager of China Resources, Wang Kuang, Director of Xinhua News Agency's Hong Kong Island Branch, and Shen Bi, among other prominent figures, were also present.

Chen Bingwen arrived on time with Mai Lisi, attracting considerable attention.

Many people recognized this young man who has recently been making waves in the capital market, a newly minted billionaire!

Zhang Jianhua greeted him warmly: "Mr. Chen, welcome, welcome! And who is this?"

He looked at Maris.

(End of this chapter)