v2 Chapter 613： Profit driven (1/2)
At this time last year, the market value of the Land Group was only about 4.8 billion Hong Kong dollars. Then, because the Land Group sold some of its shares in Wharf and other companies, it is reasonable to say that its assets have shrunk partly. The market value should be Falling.
But one is because after a year, the Hong Kong stock market has risen a lot compared to a year ago, and the market has risen. As a leading stock in the real estate industry in Hong Kong, Land Group has naturally risen in market value.
Of course, the other reason is that after the Jardine consortium fell apart, bigwigs from all walks of life focused on the Land Group, and the share price of Land Group rose sharply because of the fight for equity.
These two important reasons have offset some of the impact of the shrinking assets of the Land Group, and the influence of various bigwigs deliberately dragging the Land Group's business down.
Think about Hutchison Whampoa. The market value of Hutchison Whampoa has not been out of the quagmire. Compared with a year ago, the market value has only risen by a few hundred million, while the Land Group has risen by more than one billion, which is already very good.
Having said that, even if you give the Land Group a 20% premium, it is still very cost-effective. George Berkeley read the detailed information given by the boss Xia Yu and knew that the Land Group is a company whose actual assets are greater than the market value, even if the premium is 20%.
Now the initial bid of 10% is just to leave some buffer space for negotiation.
Sure enough, upon hearing George Berkeley’s terms, Burton Keswick shook his head and refused without hesitation: ”Mr. George, your price is too low, and I firmly disagree.”
”No, no, Mr. Bolton, you should be very clear that the stock price of Hongkong Land Group is falsely high...”
”Mr. George, the stock price of the Land Group is not overpriced at all. Believe it or not, I will release the news to sell the shares. Some people will buy it. A premium of 40% is fine...”
”Mr. Bolton, you can believe this. I have read the last year's financial report of the Land Group. The group's net profit was only 310 million Hong Kong dollars. Many of its subsidiaries suffered losses, resulting in only a little net profit attributable to group shareholders. 800 million Hong Kong dollars. In the first quarter of this year, revenue dropped by 30% year-on-year. According to the current trend, the group's net profit this year will only be even less.”
”The current price-earnings ratio of Land Group is as high as 19 times, which is far beyond the current price-earnings ratio of Hong Kong stock companies that is less than 10 times. Under this circumstance, do you think the market value of Land Group is not excessively high? I give a 10% premium. , You definitely make a lot of money.”
”I don't agree with you, Mr. George, the value of a company depends not only on its P/E ratio, but also its future prospects...”
...
One wanted to sell and the other wanted to buy, so although they were in talks and talks, they did not leave. After a fierce argument, George Berkeley killed at a premium of 15%, while Burton Keswick killed at least 32%. , The negotiations reached a deadlock, and no one was willing to give in.
However, it can also be seen from the increase and decrease in terms of both parties that George Berkeley is more dominant in the negotiation.
The negotiations could only be suspended, and then the two left. After a day of calming down, they negotiated again the next day.
On the third day, an agreement was finally reached. The Bright Fund bought a 10.5% stake in the Land Group held by Bolton Keswick at a premium of 20% at a price of HK$742 million.
”Happy cooperation!”
In the meeting room of the Bright Fund, George Berkeley and Burton Keswick stood up to shake hands after signing the agreement.
Since the share certificate of Hongkong Land Group is in Xiangjiang, not here, it is only an initial agreement, which also has a certain legal effect.
After that there will be arrangements to clear the money and goods.
Just when Bolton Keswick was about to leave, George Berkeley called him again: ”Mr Bolton, please wait a moment, I have a business I want to talk to you, which is very beneficial to you.”
Bolton Keswick paused, turned around and asked suspiciously, ”What business is there?”
”Yes, it can bring you huge benefits, we sit down and say.”
”Ok.”
In the meeting room of the Bright Fund, the two were seated again, Burton Keswick did not speak, and gestured to George Berkeley to speak.
”I heard that other people in your family also plan to sell shares, right?”
As soon as George Berkeley said these words, Burton Keswick's face froze, his thoughts changed sharply, and he hesitated for a few seconds before he said vaguely: ”I don't know this, it should be possible.”
George Berkeley chuckled and said: ”Mr. Bolton, you don't have to be wary. I said that it can bring you huge benefits. We want to buy more shares of Land Group at a premium of 20%. As for how much money you can buy. , That’s your business. If you can buy 10% of the equity at a fair price, then you can make more than 100 million when you change hands.”