Becoming the King of Bottom Fishing After Going All-In on A-Shares

Chapter 121 The Lui Family, a Hong Kong Tycoon

October 5th, Wednesday, 6:00 AM.

U.S. stocks surged overnight, with the Dow Jones Industrial Average up 3.28%, the S&P 500 up 4.08%, and the Nasdaq Composite up 3.12%.

With Obama elected President of the United States, the market has high expectations for an economic stimulus package.

He put down his phone, got up, and washed up.

7:15, West Gate of Renmin University.

Wen Zhiyu was already waiting. She handed over the insulated bag, which Lu Chenzhou took, opened, and took a sip of porridge.

"Sign the contract today?" she asked.

"Yes. I signed the public offering shell company agreement this morning, and flew to Hong Kong this afternoon to meet Permira."

""

"Is it too late?"

"There's still time."

The two walked side by side toward the science park, the ground covered with fallen ginkgo leaves that rustled underfoot.

7:50, Room 608.

Zhang Yixing is already in front of the computer.

Xia Yaozong leaned against the window, holding his phone, while Yang Cheng sat in the corner flipping through documents. All three of them were there.

"Hong Kong Hang Seng Index futures opened 1.8% higher, Galaxy Entertainment was up 0.63 pre-market, and SJM Holdings was up 1.35 pre-market."

Lu Chenzhou sat down, turned on his computer, and glanced at his holdings.

China National Building Material 3.97, China Shenhua Energy 14.74, Anhui Conch Cement 25.75, Galaxy Entertainment 0.60, SJM Holdings 1.30.

Foreign investors dumped shares all day yesterday, but he bought 6500 million shares of Galaxy Entertainment. Both gaming stocks closed lower, but his overall account still made a profit of over 3100 million.

We have over 8 million in cash on hand, and we're going to spend a large sum today, but it's all worth it.

He closed his laptop.

"Let's go, let's sign the contract."

Nine o'clock in the morning, Financial Street.

The shell company of the mutual fund management company is located on Beijing's Financial Street.

The seller is a small fund company with all the necessary licenses and a QDII quota, but the team has disbanded, leaving only an empty shell.

When Lu Chenzhou arrived, the seller's representative was already waiting in the conference room.

A man in his forties, dressed in a suit and tie, with his hair neatly combed, but his eyes revealed fatigue.

Since the financial crisis, small fund companies have been unable to survive, and selling their shells is the only way out.

"Mr. Lu?"

"Um.

""

After both parties sat down, the lawyer took out a thick stack of contracts, one in Chinese and one in English.

Lu Chenzhou took it and read it page by page.

Zhang Yixing sat next to him, Xia Yaozong leaned against the window, Yang Cheng sat in the corner flipping through documents, and Wen Zhiyu stood at the door with a notebook in his hand.

The meeting room was quiet, with only the sound of turning pages.

Forty minutes later, Lu Chenzhou closed the contract and placed it on the table.

"2.5 billion?"

"2.5 million." The seller's representative nodded. "Clean license, no debt, QDII quota of 3 million US dollars."

"$3 billion?"

"Yes, the credit limit hasn't been used since the financial crisis; it's still there."

Lu Chenzhou was silent for a few seconds: "3 million US dollars is enough."

He picked up the pen and signed the contract.

This 2.5 million yuan is not from Zhizhou Capital.

The money in a fund belongs to the investors and cannot be used to buy companies.

It was a personal loan he took out from the bank.

During the financial crisis, bank approvals were slow, but Yang Cheng had connections, so it was approved in just one day.

The seller's representative watched as Lu Chenzhou finished signing, then looked at Zhang Yixing, Xia Yaozong, and Yang Cheng.

He spent six months selling the product and met with more than a dozen buyers, including state-owned enterprises, private enterprises, and private equity firms.

The person who ultimately bought the shell was a college student.

"Mr. Lu, congratulations."

Lu Chenzhou nodded and stood up.

"The money will arrive this afternoon."

10:30 a.m., Room 608, Renmin University Cultural and Technological Park.

Lu Chenzhou pushed open the door, walked to his seat, sat down, and turned on his computer.

The Hong Kong stock market had already opened, and he glanced at his holdings.

China National Building Material 3.97, China Shenhua Energy 15.74, Anhui Conch Cement 25.75, Galaxy Entertainment 0.60, SJM Holdings 1.30.

He stared at China Shenhua for a few seconds.

5602.50 million shares, cost price 10.20, current price 15.60.

"Shenhua, clearance sale," he said.

Zhang Yixing turned his head, Xia Yaozong walked over from the window, Yang Cheng closed his book, and Wen Zhiyu frowned.

"All of them?" Zhang Yixing asked.

"all."

Lu Chenzhou's fingers touched the keyboard, and he began to place an order.

The first transaction was for 500 million shares at 15.70.

The second transaction involved 500 million shares at 15.68.

The third transaction involved 500 million shares at 15.65.

Stroke by stroke, slowly and deliberately.

Just as Lu Chenzhou finished clearing out his inventory, Wen Zhiyu reminded him, "Brother Lu, we still have to catch our flight."

Lu Chenzhou nodded and looked at Zhang Yixing, Yang Cheng, and Xia Yaozong: "I'll leave the fundraising to you."

Xia Yaozong leaned against the window, his phone still in his hand.

"With the A-share market currently at 1700 points, if you invest a private equity fund in A-shares, with a minimum investment of 100 million yuan, will you be able to raise the funds?"

"We'll raise as much as we can."

"What about public funds?"

"The existing public fund products are still available. If you want to subscribe, just do so. We will neither actively promote nor stop you."

Yang Cheng raised his head from the corner.

Who's in charge of fundraising?

Lu Chenzhou thought for a moment and said, "Yixing will be in charge of connecting with investors, Yaozong will be in charge of the funding channels, and Yang Cheng, you will keep an eye on compliance."

The three of them responded.

Lu Chenzhou picked up his coat and walked towards the door.

Wen Zhiyu picked up her bag and followed.

Lu Chenzhou and Wen Zhiyu walked to the door, but before they could open it, Xia Yaozong's voice came from behind them.

"Take care, busy man."

Lu Chenzhou ignored him and placed his hand on the doorknob.

Zhang Yixing added, "Brother Lu is currently juggling multiple roles: Hong Kong stock trader, public fund manager, private equity fund manager, and he also has to fly to Hong Kong to sign contracts. He's definitely a very busy person."

Yang Cheng turned a page of his book without looking up: "The busiest one isn't him, it's Wen Zhiyu."

Xia Yaozong laughed: "That's right. Wherever Brother Lu goes, she goes; when Brother Lu signs a contract, she hands him the documents; when Brother Lu flies to Hong Kong, she books his plane ticket."

Brother Lu is a busy man, and she's his busy secretary. Even busier.

Wen Zhiyu turned around and glanced at them expressionlessly.

"Are you done talking?"

"I'm done talking." Xia Yaozong raised his hands in surrender.

"We're done talking, let's go."

Lu Chenzhou opened the door and went out.

Wen Zhiyu followed behind, and the door closed.

There was a moment of silence in room 608, then Xia Yaozong burst out laughing.

"Her eyes are exactly the same as Brother Lu's."

Zhang Yixing smiled too.

"After staying here for a while, you start to resemble them."

Yang Cheng turned a page of his book, and the corner of his mouth twitched slightly.

3 p.m., Central, Exchange Square.

Lu Chenzhou and Wen Zhiyu walked into the lobby, and the receptionist made a phone call, and someone came down to meet them.

A man in his thirties, dressed in a suit and tie, speaking Mandarin with a Cantonese accent.

"Mr. Lu? I am Chen Yongji from Permira Asia. Mr. Thompson is waiting for you upstairs."

The elevator went up to the 42nd floor, the doors opened, and there was a small conference room.

A long table, a few chairs, a pot of tea, and a few documents.

Outside the window is Victoria Harbour, and the setting sun has turned the sea golden.

Mark Thompson was standing by the window when he heard the door open, and he turned around.

He was in his fifties, with gray hair and bright eyes.

The head of Permira's Asian operations, who spearheaded the deal to acquire a 20% stake in Galaxy Entertainment in 2007.

HK$65 billion, HK$8.42 per share—that was the highlight of his career.

A year later, he sat at the negotiating table opposite a 20-year-old student.

"Mr. Lu?" He extended his hand.

"Mr. Thompson."

The two shook hands and sat down.

Wen Zhiyu sat down next to Lu Chenzhou and opened her notebook.

Chen Yongji sat next to Thompson, with several documents spread out in front of him.

Thompson skipped the pleasantries and immediately opened the documents on the table.

"8.4 million shares, HK$0.80, that's our offer."

Lu Chenzhou glanced at the number.

"0.80, which is 33% higher than yesterday's closing price."

Our cost is 8.42.

That's your business.

Thompson was silent for a few seconds.

Lu Chenzhou picked up his water glass and took a sip.

"0.60."

Thompson shook his head.

"0.60 is too low."

"0.65."

"0.75," Thompson said.

Lu Chenzhou put down his water glass: "0.70."

Thompson glanced at Chen Yongji, who nodded slightly.

"0.72," Thompson said. "8.4 million shares, that's the bottom line."

Lu Chenzhou hesitated for a few seconds: "Okay, 0.72."

Thompson presented the contract to Lu Chenzhou.

"The shareholders' agreement stipulates that the Lü family has a right of first refusal to purchase Permira's shares."

We have notified Mr. Lui Che-woo in writing, and he has agreed; this is his written confirmation.

Chen Yongji pulled a document out of the file bag and pushed it in front of Lu Chenzhou.

Lu Chenzhou picked it up and glanced at it.

The signature of Lui Che-woo, the seal of Galaxy Entertainment, and the date are yesterday.

"Did he agree?" Lu Chenzhou asked.

"He agreed," Thompson said.

Lu Chenzhou didn't ask why. He put down the document, picked up a pen, and signed the contract.

Wen Zhiyu checked the page numbers and stamped the seal of Zhizhou Capital.

Thompson also signed it and stamped it with Permira's seal.

The two parties exchanged contracts.

Thompson stared at the signed contract and remained silent for a few seconds.

"HK$6.05 million, when will the money arrive?"

"Today," Lu Chenzhou said.

Thompson nodded, stood up, and extended his hand.

"Congratulations."

Lu Chenzhou squeezed his hand.

"Congratulations."

Chen Yongji put the contract into a document bag and stood up to see the guest off.

The elevator doors closed in the corridor.

Wen Zhiyu pressed the button for the first floor, and the elevator began to descend.

"Lui Che-woo agreed," she said.

"Um.

""

"Didn't you ask him why?"

"No need to ask," Lu Chenzhou said. "His agreement is enough."

Moreover, even if the Lü family wanted to buy it now, they couldn't afford the money; they were already struggling to breathe under the weight of their bank debts.

"If we buy shares in Galaxy Entertainment now, they won't hate us; on the contrary, they'll treat us like royalty."

Wen Zhiyu was stunned: "That's a Hong Kong tycoon family, why would they treat us like royalty?"

Lu Chenzhou said with a smile, "Our purchase of Galaxy Entertainment now is like sending charcoal in snowy weather, a lifesaver. It's not an exaggeration to treat us like royalty."

Of course, only at this point will they agree to sign.

Otherwise, don't even think about it.

And believe it or not, there are members of the Lü family waiting for us downstairs.

Wen Zhiyu wanted to say she didn't believe it, after all, that was the Lu family, a wealthy family in Hong Kong, how could they possibly wait for you specifically?

However, when she thought of the various miracles Lu Chenzhou had created along the way, she had nothing to say.

The elevator reached the first floor, the doors opened, Lu Chenzhou stepped out, and Wen Zhiyu followed behind.

In the lobby, a man in his forties stood next to the front desk, dressed in a sharp suit, his hair neatly combed, holding a file folder in his hand.

Seeing Lu Chenzhou come out, he quickly went to greet him.

"Mr. Lu? I am Mr. Lui Che-woo's personal assistant. My surname is Ho. Mr. Lui asked me to wait for you here."

Wen Zhiyu glanced at Lu Chenzhou, then at the man.

Lu Chenzhou looked at the other person: "Mr. Lü, what is it?"

Assistant He bowed slightly and said respectfully, "Mr. Lü said he welcomes you to become a shareholder of Galaxy Entertainment and would like to invite you to dinner tonight. Would that be convenient for you?"

Lu Chenzhou glanced at his watch; it was a little past four in the afternoon. "Convenient."

Assistant He nodded: "Then Mr. Lü will be waiting for you at 7 p.m. in the Mandarin Oriental Hotel's Mandarin Ballroom. I will send a car to pick you up then."

"No need, we'll go ourselves."

Assistant He gave a slight bow, then turned and left.

Wen Zhiyu watched the person's figure disappear through the revolving door: "He really was waiting for you."

"Um."

How did you know?

Lu Chenzhou glanced at the door: "Because Lui Che-woo knows better than anyone else that at this time, there are very few people in Hong Kong who can come up with HK$6 million to take over Permira."

He could come up with 6 million, but he won't.

It's not that I don't want to, it's that I can't.

The bank was holding him back; he needed to save his money to pay off debts and maintain his 35% stake. He didn't have spare cash to buy more Permira shares.

He paused for a moment, then continued, "So, he needs a buyer—someone who can take over Permira's shares without threatening his controlling stake. I happen to meet both criteria. How could he possibly disagree?"

Wen Zhiyu stared at him for a few seconds: "So he doesn't welcome you, he needs you."

Lu Chenzhou smiled and said, "Need and welcome are not contradictory. He needs me, so he welcomes me. It's a win-win situation."