Rebirth in Hong Kong: From Dessert Shop to Industrial Empire

Chapter 224 Bargaining Chips (Seeking monthly votes, recommendations, and subscriptions!)
After Bao Yugang intervened, Chen Bingwen spoke very politely on the surface, but in reality, he did not stop Huo Jianning from secretly acquiring shares of Cheung Kong Holdings.

He knew that Sir Michael Sandberg and Lee Ka-shing were simply trying to muddy the waters through Y.K. Pao, hoping to bring the potentially tense open dispute back to the path they were better at: resolving the issue through behind-the-table negotiations.

This is a delaying tactic in itself, indicating that they are also wary of a direct confrontation, fearing that complications might arise and affect HSBC's plan to sell its Hutchison Whampoa shares smoothly.

But the business world is like a battlefield, and true reconciliation is always based on equal strength.

The so-called "talks" are nothing more than an exchange of interests after a certain amount of leverage has been accumulated.

At the final negotiating table, whoever holds the most cards has the loudest voice.

Back in his office, he immediately sought out Huo Jianning to understand the situation.

"How is the acquisition of Cheung Kong Holdings' shares progressing?" Chen Bingwen asked Huo Jianning.

“It’s going smoothly.” Huo Jianning handed over a briefing. “Progress is going smoothly but slowly.”

Cheung Kong Holdings' circulating shares are not large, and the Li family holds a high percentage of the shares. We quietly accumulated shares through more than a dozen dispersed accounts, and currently hold approximately 2.3% of the shares, at a cost of about HK$35 million.

The market didn't pay much attention, and Cheung Kong Holdings didn't seem to notice either.

Chen Bingwen nodded.

He was very clear about the shareholding structure of Cheung Kong Holdings. The Li Ka-shing family held an absolute controlling stake, and his acquisition amount posed no threat to Li Ka-shing's control.

However, his goal was not to gain control of Cheung Kong Holdings, but to use it as a bargaining chip at a crucial moment to gain more benefits in the Hutchison Whampoa deal.

Chen Bingwen instructed, "Continue the acquisition. Acquire as much as you can without significantly driving up the stock price. As for funding, have Director Fang prioritize your side."

Consider this investment as a strategic form of insurance.

Meanwhile, McLeish has already set off for North America to take charge of acquiring the two beverage bottling plants that Ling Pei-yi had previously inspected.

Chen Bingwen's instructions to him were very clear: prioritize the Illinois company with more advanced equipment, the price is negotiable, the key is to be able to start production quickly, and ensure "Pulse's" autonomy in the North American supply chain.

Just as McLeish was conducting negotiations in North America, some discordant voices emerged from the North American market.

That afternoon, Chen Bingwen received an urgent phone call from Li Ming in the United States.

"Mr. Chen, something's not right here." Li Ming's voice clearly carried suppressed anger.

"Tell me slowly, what happened?" Chen Bingwen put down the documents in his hand.

"It's a Coca-Cola franchise bottling plant."

Li Ming reported, "In the past two weeks, we've had a constant stream of minor troubles."

First, the production line for our pulsed energy products kept malfunctioning unexpectedly, delaying delivery by two days.

They then mentioned that the supply of packaging materials was tight, and the production plan for the next batch of orders would be postponed.

This week was even more outrageous; the promised promotional materials were either delivered in the wrong quantity or to the wrong address.

I went to talk to their manager, and they were quite polite, promising to fix it immediately, but then they went back to doing the same thing again!

Li Ming became increasingly angry as he spoke: "This is clearly intentional! They're just going along with it on purpose and dragging us along."

Although each thing seems minor and does not violate any of the hard and fast rules of the contract, if things continue like this, our market supply and promotional activities will definitely be affected.

This is like boiling a frog in lukewarm water!

Chen Bingwen listened to Li Ming's report with perfect clarity. He had expected this day to come.

How could Coca-Cola and Pepsi, these local giants, possibly stand by and watch "Pulse," an outsider, grow stronger by leveraging their channels?
This subtle, underhanded approach is a common tactic used by large companies, allowing them to effectively curb competitors without open conflict.

"Chen Sheng, what do we do now? These guys are clearly taking advantage of us because we're outsiders!" Li Ming asked.

"I understand, it's not your fault."

Chen Bingwen comforted them, saying, "They did this simply because they saw a threat."

First, stabilize your existing sales channels, expedite deliveries where necessary, hold those responsible accountable, and keep all communication records safe.

I'll handle the rest.

After hanging up the phone, Chen Bingwen pressed the internal call button: "Ali, please ask Attorney Gu to come over."

A few minutes later, Gu Yongxian arrived at the office.

“Attorney Gu, there’s been a bit of a problem in North America.” Chen Bingwen briefly explained the situation Li Ming had described: “Coca-Cola’s bottling plants are giving us a hard time, using various non-violent non-cooperation methods to delay our production and sales.”

Gu Yongxian said, "Mr. Chen, according to the cooperation agreements we signed with Coca-Cola and Pepsi, they are obligated to ensure smooth distribution channels and production."

While individual instances of the other party's current actions may not constitute a major breach of contract, their overall behavior may violate the principle of good faith cooperation stipulated in the agreement.

"Hmm." Chen Bingwen nodded. "My idea is to try diplomacy first, then resort to force."

On behalf of Sugarheart Capital and Chenji Foods, you sent formal lawyer's letters to the headquarters of Coca-Cola and PepsiCo respectively.

He paused for a moment, then continued, "The lawyer's letter clearly lists all the problems Li Ming encountered, noting the time, event, and impact."

They were required to urge their franchised bottling plants to rectify the situation and fulfill their contractual obligations within a specified period.

At the same time, the letter clearly reminded them that the licensing of the bottle cap patent is tied to channel cooperation.

If they cannot guarantee the normal production and sales of our products, we will have to reassess the sustainability of the patent licensing agreement.

Gu Yongxian: "Using patent licensing to counter channel restrictions is a powerful bargaining chip."

At this stage, neither company wants to see problems with the bottle cap patent licensing, as this would directly affect the anti-counterfeiting measures and market order of their core products.

“That’s right,” Chen Bingwen affirmed. “Unless they can bypass our patent barrier in a short period of time, they won’t dare to completely break off relations.”

Sending a lawyer's letter is mainly to express our attitude and exert pressure.

But we cannot place all our hopes on others.

The friction with the two major cola giants came sooner than he had anticipated.

However, he wasn't completely unprepared.

The previous plan to have Ling Peiyi look for and acquire local factories in North America was actually to prepare for this day; now it's just a matter of speeding up the plan.

After all, relying on the channels of Coca-Cola and Pepsi is only a temporary expedient. Only by having its own production capacity and sales channels in North America can a company remain invincible in market competition.

In addition, he plans to select more than a dozen outstanding field promotion team leaders from the Hong Kong Island grid-based field promotion team and send them to North America to support Li Ming.

These people honed their skills in dealing with various emergencies on the streets of Hong Kong Island, which is perfect for helping Li Ming stabilize the terminal channels and make up for the gap caused by the poor cooperation of the bottling plants.

(End of this chapter)