The birth of the Hong Kong Island family

Early April.

"Sir Lin, this is the tender document for Container Terminal No. 7, as well as the reference price!" Ma Shimin handed a portfolio to Lin Zhichao and said seriously.

The No. 7 Kwai Chung Container Terminal is about to be tendered, and Ma Shimin has also done a lot of careful work for this matter. After all, container terminals are very popular nowadays. There are many domestic and foreign consortiums coveting the No. 7 Kwai Chung Container Terminal, but they may miss the mark if they are not careful.

Today, Hutchison Whampoa owns Kwai Chung Container Terminal 4 and 6, with a total of 6 berths, of which Kwai Chung Container Terminal 6 has 4 berths.

The No. 7 Kwai Chung Container Terminal that is about to be tendered is a large terminal with four berths. Once Hutchison Whampoa wins the bid, it will establish Hutchison Whampoa's absolute dominance in Hong Kong's container terminals.

Lin Zhichao took out the bidding information from the portfolio and read it carefully.

The reference price of No. 7 Kwai Chung Container Terminal is 4.09 to 4.39 billion Hong Kong dollars (Ma Shimin's analysis). The content of the tender document also states that after winning the bid, reclamation and construction will begin immediately, which is expected to cost 2.5 to 2.8 billion Hong Kong dollars.

In other words, the entire No. 7 Kwai Chung Container Terminal requires an investment of HK$7 billion, which is a huge investment.

As for No. 6 Kwai Chung Container Terminal, Hutchison Whampoa only invested HK$2 billion.

Of course, although both terminals have four berths, the conditions such as the yard area, whether there is a container building, commercial land, etc. are different; moreover, the container terminals are getting busier and busier, and the more business they have, the more valuable they are. , the Hong Kong government naturally hopes that everyone will compete for this pier, because the Hong Kong government is also short of money.

"Well, I think it's pretty good. Leave the information here with me. I'll take a look at it and let you know if there are any problems!"

"No problem. I think the highest price is more reassuring. What do you mean?"

"Okay, the price of 4.39 billion Hong Kong dollars is a sure win. I believe other consortiums cannot afford this price."

Lin Zhichao readily agreed to bid because No. 7 Kwai Chung Container Terminal is very important to Hutchison Whampoa.

Today's Hutchison Whampoa has five core businesses planned by Lin Zhichao: real estate development, ports and terminals, retail, telecommunications, and energy.

Importantly, these five major businesses must extend to North America, Europe, and the Asia-Pacific region.

Hutchison Whampoa's profit exceeding 3 billion this year is already a certainty. Although it has only passed the first quarter, Lin Zhichao has already made predictions. Therefore, Hutchison Whampoa does not lack money for its development.

Next, Lin Zhichao said: "We have been unable to enter the board of directors of the British Dadong Telegraph Bureau. It seems that this acquisition is just to make a small amount of money, and there is no possibility of cooperation."

Ma Shimin suddenly felt a little ashamed. He was leading Hutchison Whampoa's overseas expansion. But the only real success now is the acquisition of Husky, because it has gained control.

The acquisition of Husky is indeed the credit of the boss, not the management of Hutchison Whampoa.

The London office, which was established in 1985, successively acquired Pearson and the British Cable and Telegraph Company, but there was no chance for further cooperation, so the only option was to cash out the stocks in hand while the prices were high and obtain a little profit.

Ma Shimin said: "Investing in Dadong Cable and Telegraph Company is not completely fruitless, and it can be regarded as showing our determination to invest in telecommunications. We are now searching for the mobile phone business in the UK and preparing to make acquisitions to achieve our first step in overseas telecommunications."

Lin Zhichao nodded. Telecommunication services are generally divided into overseas calls, domestic/local calls, mobile phones, and pagers. Among them, overseas calls, domestic/local calls, and fixed-line phone services are generally provided by state-owned enterprises in a country or region, because they involve national security (submarine cables) and so on.

Hong Kong's fixed-line telephone business is currently exclusively owned by Hong Kong Telephone, a subsidiary of the British Cable and Telegraph Company, but a gap will soon be opened, and urban fixed-line telephones will be issued second and third licenses.

Telephone bills in this era are very expensive, especially for some companies in Hong Kong. It is normal for some companies in Hong Kong to spend hundreds of thousands of Hong Kong dollars on fixed-line calls every month.

"Okay, Hutchison Telecom is bound to develop overseas. The local market is too small! In addition to the UK, we can also consider the paging market in Australia, and then further enter the mobile phone market in the future."

"Well, we will study it carefully and come up with a plan for you later!"

Hutchison Whampoa’s real estate business, in addition to the ‘Whampoa Garden’ under development, also included Laguna City, Harbor Plaza (equity shareholding), and real estate investment in Japan in the 1990s.

Hutchison Whampoa's retail business, the two major brands of Watsons and Parknshop Supermarkets, have already left Hong Kong and already have hundreds of stores in the Asia-Pacific region.

Container terminals are still developing in Hong Kong;

The telecommunications industry is moving out of Hong Kong.

In the energy industry, Hong Kong Electric and Husky are its representatives.

As for trade and other businesses, they are no longer considered core industries.

In a large private room of the New World Hotel, six people, Lin Zhichao, Zheng Yutong, Li Shauji, Huang Tingfang, Guo Desheng, and Li Jiacheng, were discussing important matters behind closed doors and dismissed all service staff.

Everyone was sitting on the sofa, their expressions were more serious than just chatting, among them Zheng Yutong was the most serious.

It turned out that the big Chinese bosses were eyeing the struggling Land Corporation, especially Zheng Yutong, who was coveting Land's remaining high-quality Central properties and wanted to 'kill them all'.

Zheng Yutong has always disliked acquisitions, but now that he is about to retire, he wants to "take the limelight" and win the Land Company. Of course, with Zheng's financial resources, it is not possible to acquire real estate. After all, a skinny camel is bigger than a horse.

Currently, the properties in Hongkong Land's hands include: Alexander Building, Hong Kong Parliament Building, (Landmark Plaza, Gloucester Building, Lobby and Duke's Building), Prince's Building, Swire Building, and 9 Queen's Road Central. These are just the properties in Central. , and also owns the World Trade Towers and Excelsior Shopping Center in Causeway Bay, as well as the Diligent Court luxury project in Mid-Levels.

Based on these alone, Land is still the third largest real estate company, second only to Cheung Kong Holdings and Wharf Group, and its market value is higher than Sun Hung Kai, Henderson Land, etc.

Importantly, Land's asset value is actually much lower than its market value, and its net asset value should be around HK$20 billion (in its previous life, it was more than HK$30 billion).

Moreover, Land has also spun off the Milk Company and Mandarin Hotel, and the scale is such, which shows that Land has a rich heritage.

At this time, the structure of the Jardine Matheson Group also underwent earth-shaking changes. In 1986, the Keswick family invited American investment banker Bowser to adjust the group's structure:

In October 1986, Land announced the spin-off and listing of Milk International, a wholly-owned subsidiary of the group. Later, Land announced the spin-off and listing of another wholly-owned subsidiary, Mandarin Oriental.

In February 1987, Jardine Matheson announced the establishment of a new listed company, Jardine Matheson Strategy (Yice), which would directly control the equity interests of Land, Dairy Farm International and Mandarin Oriental, of which it held 26% of the shares of Land. Land Group originally held shares in Jardine Matheson, which were now held by Zhice.

Yizhi decoupled, and the mutual control relationship that had been maintained for 7 years came to an end.

Jardine and Yice are mutually controlled, with Jardine holding 19% of Yice and Yice holding 26% of Jardine. Of course, the major shareholder, the Keswick family, also holds considerable shares in both companies.

After the major reorganization of the Yizhi Department, Yice replaced the holding function of Yihe. In this way, there are two lines of defense on the periphery of Jardine Matheson. The outermost line is Land, Dairy Farm International, Mandarin Oriental and other companies; the second line is Jardine Matheson's strategy.

In this way, the innermost Yihe becomes a "city within a city".

The Keswick family consolidated their stronghold, which also meant a weakening of their control over the land. Land's two wings (Milk and Mandarin) have established themselves, and Land's strength has been greatly reduced.

Moreover, Land is still placed on the periphery of the entire Jardines family. Market participants believe that this is a signal that the Keswick family intends to put the property on the market. Jardines will be sold at a price, and whoever buys the property will get it.

It was under this circumstance that Zheng Yutong focused on the fat piece of land. He knew that with his own strength, he would undoubtedly hit an egg with an egg. Therefore, he attracted many Chinese tycoons, and even Lin Zhichao, the "number one of Yihe" The killer' please come and take charge.

Before the stock market crash, Zheng Yutong negotiated with the Keswick family of Jardine Matheson on behalf of the new consortium. Zheng Yutong offered HK$12 per share to acquire 26% of the equity in Yice, which was 50% higher than the market price.

However, Simon Keswick believed that this price was still lower than the net asset value of Land, so he did not agree, but said: "The door is always open (the door is always open), The problem lies in the price (The problem lies in the price) )."

The Keswick family has not closed the door!

This made Zheng Yutong feel very hopeful and became even more excited.

Lin Zhichao, on the other hand, wanted to join in the fun. He wasn't taking the lead anyway, so it would be nice to follow along and have a sip of soup.

In the private room, Zheng Yutong said: "Now that the six-month period is about to pass, it's time for us to launch another attack!"

Why there was a six-month pause in the middle? This is due to the impact of the major stock market crash:

First, it has a certain impact on everyone’s confidence;

Second, according to the provisions of the Takeovers and Mergers Code, the acquisition price of the party proposing the acquisition cannot be lower than the value of the acquirer's purchase of the shares of the acquired company within 6 months. Before the stock market crash in October, some of the Land shares acquired by large Chinese investors exceeded NT$7. After the stock market crash broke out, Land's stock price once fell to 3.95 yuan. Later, the stock price rebounded with the market, and as of this month (1988.4), it was still hovering around 5.5 yuan. In order to avoid being restricted by the Takeovers and Mergers Code, they need to acquire land at the high price before the stock market crash. Therefore, major Chinese investors wait for the six-month deadline to pass before relaunching the offensive.

There is also a truth in this. The consortium formed by Chinese-funded tycoons wants to privatize Land and then divide the land. But they have no patience and everyone runs the Land together. So in this way, after purchasing the 26% stake in Yice, the follow-up is to fully acquire the land stocks on the market.

Therefore, the lower the price, the better.

Everyone nodded, and Zheng Yutong continued: "My idea is to send a letter directly to Land Company. We will appoint two more people to Land as directors at Land's annual general meeting on June 6. After all, we currently have 9 % of the real estate equity.”

Releasing the news is forcing Yihe to do something.

The key point of this acquisition is that Yice takes the initiative to sell its shares, so that the cost to the Chinese tycoons is the lowest. Once individual shares are acquired from the market and made public, it will be like when Universal Group acquired Wharf Group and the stock price was raised from 13 yuan to 100 yuan.

Everyone looked at Lin Zhichao, meaning that you have dealt with Land many times and are the most confident.

Of course, everyone also understands that Lin Zhichao's "focus on participation" in the acquisition of land is not dominant.

Because of this, everyone enjoys it, after all, everyone has a share of the final cake.

Lin Zhichao said: "Then Atong and Aji will join Land's board of directors. You will be the boss of this acquisition!"

Zheng Yutong and others were overjoyed. After all, Lin Zhichao took the initiative to give up his position as the leader, which showed that it was really just "participation that matters."

A few days later.

According to market rumors, the Chinese consortium has controlled a considerable amount of Land shares and plans to send a letter to Land, requesting that the appointment of New World Chairman Cheng Yu-tung and Henderson Land Chairman Lee Shau-kee be added as Land's directors at the annual general meeting on June 6. Rumors of motion.

When the news came out, Land's share price immediately soared by HK$6.23, a premium of about 10% this month.

Jardine headquarters.

Simon Keswick and Bowers are plotting.

"Lin Zhichao did not take the lead in this acquisition, which means that he is not the main initiator, so there is no need to be nervous!" Simon Keswick analyzed seriously.

If Lin Zhichao takes the lead, he will feel timid in advance.

After all, based on the analysis of the events of that year, Lin Zhichao played tricks on Niu Bijian and Bao Fuda, whether it was a smoke bomb in front of the bidding exchange square (the media released news that the value was more than 8.5 billion), or setting up a scheme to sell Carinland and Land's "Beautiful" "The Old Wing of China Hotel", and even the stock price increase during the acquisition of Hong Kong Electric, must have the shadow of Lin Zhichao.

There is only one purpose, that is, the real estate is heavily in debt and finally allowed to be slaughtered. As for why Lin Zhichao is so sure that Land will be heavily in debt, it is simple to think about it now. Once Hua Ying talks about Hong Kong, Hong Kong will become unknown.

Bao Weishi said: "Chinese tycoons are testing us, why can't we beat them!"

Simon Keswick relied heavily on this investment banking expert and immediately said: "How to beat them?"

Bao Weishi said confidently: "The outermost ones now are Land, Mandarin Oriental, and Dairy Milk International. Among them, Dairy Milk International is in the retail industry. The Chinese capital bosses will not take it seriously, because whoever acquires it will be against Lin Zhichao, and Lin Zhichao I have also given up the idea of ​​acquiring Milk International. After excluding Milk International, only the Mandarin Oriental Hotel and Land are left, which is somewhat risky. Therefore, I suggest that Mandarin Oriental issue 10% of new shares to Yice at a price of HK$4.15 per share. , increasing Yice’s shareholding in Mandarin Oriental from slightly less than 35% to 41%.”

After listening to this seemingly irrelevant suggestion, Simon Keswick did not raise any questions, but thought about it seriously.

After a while, Simon Keswick slapped the table and said:

"Brilliant! They know how to take advantage of the acquisition six months later, so why can't we do the same.

First, although Yice has reached the full acquisition line, six months have passed, and the highest price in these six months is completely affordable and has no temptation for the shareholders of Mandarin Oriental Hotel, so even if it is a public full acquisition , everyone was also very interested, and in the end, Yice only used a small amount of funds to strengthen its control over Mandarin Oriental;

Second, we use this trick to tell the Chinese-funded tycoons that Mandarin Oriental Hotel can do this, and Land can also do this. "

Land can also issue 10% new shares and sell them to Yice.

Kill two birds with one stone!

Finally, Simon Keswick said: "In addition, I plan to go to the News Agency to lobby the mainland officials. If they want to take over Hong Kong peacefully, they don't have to kill all our British capital. I believe there are mainland officials who can make it clear. Maybe things won’t come to the end.”

Bao Weishi nodded and said: "It makes sense! These Chinese capitals are so aggressive. Why don't they have mainland officials backing them now? They were not so powerful in the 1970s."

Simon Keswick said: "Well, in the early 1970s, even Lin Zhichao had to put away his sharp edge towards our British capital. As soon as he came to power, Lin Zhichao immediately jumped out to buy up British capital."

He knew Lin Zhichao very well, he was indeed a character!

No wonder later generations also invested in the mainland and made a lot of money. Simon Keswick is still more powerful than his brother and father.

On April 28, Jardine Matheson Strategy and Mandarin Oriental, which it controls, issued a joint statement that Mandarin would issue 10% new shares to Yice at a price of HK$4.15 per share, so that the Mandarin equity held by Yice would be transferred to Yice. Below 35% increased to 41%.

Market participants believe that Yice's subscription for Wenhua's new shares will inevitably exceed the 35% trigger point for a comprehensive acquisition. Yice made a comprehensive acquisition proposal in accordance with the regulations. However, since the acquisition price of HK$4.15 was lower than Mandarin's actual net asset value of HK$6, the existing shareholders of Mandarin reacted coldly, which played into Yice's plan - that is, it did not require the use of huge funds, but also made Yice's stake in Mandarin exceed The trigger point for a comprehensive acquisition has strengthened Yice’s controlling power over Wenhua.

Jardine's move can be called a killer copper, disrupting the deployment of the Chinese-funded consortium. If the Chinese consortium pursues them fiercely, Yice and the Land it controls will immediately follow suit. Yice will also be able to secure Land without spending huge sums of money.

The Chinese-owned consortium held an emergency meeting, and the consortium added a new member: Rong Zhijian of Huaxin Group. In order to prevent Yice and Land from diluting their shares, they decided to cut the knot quickly and make a quick decision.

A week later, the Jardine headquarters in Alexandria Building.

After the Hong Kong stock market closed, Zheng Yutong, together with Chinese giants such as Lin Zhichao, Li Shauji, Rong Zhijian and others, went to the headquarters of Jardine Matheson and met with Simon Keswick and other Jardine Matheson executives.

The two sides were at war with each other, and the Chinese consortium proposed to purchase approximately 26% of Yice Land's equity at a price of HK$8.4 per share.

"Impossible!" Ximen immediately hit back: "It must be 12 Hong Kong dollars per share. This is the price you were willing to pay before the stock market crash in October! You can't go back on your word!"

Zheng Yutong also responded: "According to the rules of acquisition, as long as the acquirer's price is more than 20% higher than the market price, it will take effect. What's more, our price is now 40% higher than the market price."

Ximen insisted that it must be 12 Hong Kong dollars per share.

Lin Zhichao was caught in the middle, thinking to himself, A Tong, just agree, 12 Hong Kong dollars is acceptable.

It's a pity that he has given up the initiative and naturally won't interfere too much.

When negotiations between the two parties reach an impasse.

Zheng Yutong couldn't hold back and said aggressively: "If we can't agree on the table, we'll see you in the market! Tomorrow we will announce the full acquisition of Land shares at a price of 8.4 yuan! It is 40% higher than the market price, and Land's public shareholders will definitely respond!"

Simon Keswick said: "You can do it, and we can also accompany you!"

The two sides broke up unhappy.

The Chinese-funded consortium was planning to fully acquire the company from the market, but received persuasion from Xinshe.

Everyone thought that if it were acquired from the market, Jardine might not be able to fight. Even if it were acquired, the cost would be prohibitively high.

In the end, everyone stopped all activities, which was to give face to the mainland officials. After all, everyone knew that they would enter the mainland to do business in the future.

In early May, three companies, Jardine, Yice and Land, announced the suspension of trading.

On the same day, Yice announced that it had purchased Land shares held by New World, Cheung Kong, Henderson and CITIC at a price of HK$6.8 per share, accounting for 8.2% of the total issued shares of Land.

The sudden flames of the real estate acquisition war were suddenly extinguished, and market participants were greatly disappointed.

Yice purchased the 8.2% additional equity, increasing its stake in Land from 26% to 34%. This did not trigger a comprehensive acquisition, but also greatly strengthened its holding capacity.

Cheung Kong Group still holds 1% of Land's equity and plans to hold it for the long term. (End of chapter)