Chapter 165: The Goal to Spend Five Billion, Valuations of British Conglomerates
Now, Lin Haoran had abundant funds in hand, and investment was inevitable. According to what he knew from his previous life, although the Hong Kong stock market experienced fluctuations over the next few years, the overall trend remained bullish. Occasionally, there would be drops of 10-20%, but favorable news would soon drive the Hang Seng Index back up. As for the period from 1982 to 1984, affected by the sovereignty negotiations, the Hang Seng Index fluctuated between 676 and 1000 points, but this couldn't be considered a market crash. It wasn't until 1987 that Hong Kong experienced a real stock market crash. Therefore, for the next few years, he could invest confidently.
Holding nearly five billion Hong Kong dollars, such a huge amount of capital could not be concentrated on just one listed company. Moreover, his businesses would continue generating wealth for him, so he wouldn't lack money anytime soon. Investing boldly and aggressively was what he needed to do. Leaving it in the bank to earn minimal interest would be a waste.
Hong Kong had many high-quality listed companies. For Lin Haoran, even if he didn't aim to control them, investing in their stocks would still yield substantial profits in the future. Companies like Land Holdings, Wheelock & Company, Swire Pacific, Towngas, Kowloon Motor Bus, China Motor Bus, and The Hongkong Hotel Company were all excellent targets. Especially Land Holdings—he had thought about acquiring this "Central Landlord" real estate giant even when he was taking over Qingzhou Cement Company. Now, with sufficient funds, he could start laying out plans for Land Holdings earlier.
Besides domestic enterprises, famous international companies were also attractive investment options—companies like Coca-Cola, Berkshire Hathaway, Intel, and so on. Holding these stocks long-term would lead to hundreds or even thousands of times returns.
"Looks like Huanyu Investment Company needs to expand. With just a few people handling minor operations, that's not enough," Lin Haoran thought. If it was only about managing one or two companies' stocks, the current team could handle it. But as the number of investments increased, they would definitely be stretched too thin. Moreover, the companies he was targeting were getting bigger and bigger, and managing them would become more challenging.
Seeing that Chen Shoulin hadn't returned from his meeting, Lin Haoran left Hongkong Electric and headed to Wan'an Group's building. He didn't go directly to Huanyu Investment but went to the office of Wan'an Group's general manager instead.
Inside the office, Yang Mingyi was on a call. From the few words he caught, Lin Haoran could tell he was negotiating a deal. Seeing Lin Haoran come in, Yang Mingyi pointed at the phone to signal him to wait. About a minute later, he hung up.
"Boss, congratulations on becoming chairman of Hongkong Electric Holdings!" Yang Mingyi stood up and respectfully congratulated him. News of Lin Haoran's takeover had already made huge waves, and as his subordinate, Yang Mingyi was naturally well aware.
"Thank you. Were you negotiating a project just now?" Lin Haoran asked with a smile.
"Boss, there's a building project in Wan Chai currently looking for a suitable construction partner. Our Wan'an Construction Company has become one of the potential partners, but it hasn't been finalized yet," Yang Mingyi explained.
Lin Haoran nodded. "By the way, Mr. Yang, I want to speed up Wan'an Group's development. It's progressing too slowly. Do you have any ideas on how to make it grow several times faster in a short period? We don't need to match giants like Land Holdings or Cheung Kong Holdings immediately, but we should at least grow several times larger."
Compared to when he had first taken over, Wan'an Group had improved somewhat, but not by much. One reason was that Lin Haoran had not invested much energy here. Although Yang Mingyi had been eager to expand quickly, without enough funding and resources, he had been powerless.
Now, Lin Haoran had successfully acquired Qingzhou Cement and Hongkong Electric, holding massive resources, and even Amigo Company had bought a large piece of land in Kwun Tong to build its own factory. All these projects could potentially be handed over to Wan'an Group. However, given Wan'an's current small scale, it clearly couldn't handle so much work. Even the land at Hung Hom where Qingzhou Cement's headquarters was located was too much for Wan'an to develop alone.
"Boss, it's very difficult for Wan'an Group to suddenly expand by several times, but if we meet a few conditions, we can definitely grow quickly. First is funding. Wan'an Group currently lacks funds; most of the previous loans were used to buy land, and cash flow from other projects is tight. To expand directly, we'll need significant capital support. Second is projects. Currently, we only have two major projects: a commercial building in North Point and the Shangri-La Hotel project in Tsim Sha Tsui. Other projects are either too small or still under negotiation, like the Wan Chai project I was just discussing. As long as we have enough funds and projects, we can easily multiply Wan'an Group's scale in a short time. Right now, Hong Kong's real estate sector is booming, and there's no shortage of skilled construction workers. We can expand construction teams anytime. In addition, there's another method—merging with another real estate company. That would directly boost our strength," Yang Mingyi carefully explained his ideas.
Lin Haoran nodded. He had considered acquiring a real estate company to merge with Wan'an Group but hadn't yet found the right candidate. Assigning Yang Mingyi to this task seemed fitting, since he was already familiar with the industry. Besides, stock prices in early 1980 were still relatively low, making acquisitions cost-effective.
"Alright, Mr. Yang. I'll inject two hundred million Hong Kong dollars into Wan'an Group for now. Use it to expand the company. As for projects, don't worry. There are plenty waiting for you. For instance, Qingzhou Cement's headquarters land in Hung Hom — I plan to develop it into a major commercial center. Also, Hongkong Electric has numerous upcoming projects. Currently, Wan'an Group simply isn't strong enough to participate, so I plan to upgrade our capacity first."
"Additionally, you must be very familiar with Hong Kong's real estate industry. I intend to acquire a real estate company with a market value within five hundred million Hong Kong dollars. After the acquisition, we will directly merge it into Wan'an Group. This way, our Wan'an Group will experience a qualitative leap!" Lin Haoran said directly. A real estate company under five hundred million Hong Kong dollars would be enough. Even Li Jiacheng's Cheung Kong Holdings had only a market value of a little over one billion Hong Kong dollars after acquiring Hutchison, and three months ago it had been around one billion. Now, with ample funds at his disposal, Lin Haoran was in a prime position to act boldly. After all, everything was about setting up the future and better development, so it was all worth it.
Hearing his boss's words, Yang Mingyi was already thrilled. He knew very well how wealthy his boss was; otherwise, he couldn't have taken over a British giant like Hongkong Electric Holdings. As the general manager of Wan'an Group, managing the company's daily operations, he naturally hoped to see Wan'an Group grow bigger. However, the gap between Wan'an and other major real estate companies was still significant. Now, with his boss's full support, this was a once-in-a-lifetime opportunity for Wan'an to rise.
"Boss, rest assured. I'm very familiar with Hong Kong's real estate companies. I'll immediately start scouting for suitable acquisition targets!" Yang Mingyi said, patting his chest with excitement. At this moment, he could already envision Wan'an Group becoming one of Hong Kong's top real estate giants.
"I will transfer two hundred million Hong Kong dollars to the group's corporate account today. Leave the rest to you. Do well, and following me, your future will be bright," Lin Haoran said with a smile as he left the general manager's office. After leaving, Lin Haoran headed straight to Huanyu Investment Company's office.
Since the acquisition of Hongkong Electric's shares had just concluded, Huanyu Investment currently had no pressing tasks and was quite relaxed. "Good morning, Boss." Employees greeted him one after another as he entered. Lin Haoran nodded at each one and signaled Su Zhixue to follow him into the general manager's office.
"Boss, I paid special attention to Hongkong Electric's shares today. Originally, I thought the stock price would fall, but surprisingly it has risen. In a short time, it has climbed to HK$3.9 per share, now heading towards HK$4, with high trading volume," Su Zhixue reported. "Really?" Lin Haoran was a bit surprised. Everyone, including himself, had thought that after the announcement of his takeover, the stock price would fall. Yet not only had it not fallen, it had risen quite quickly. In just over two hours this morning, the price had gone up by HK$0.1, even without Huanyu Investment pushing it.
Judging by the market's reaction, it was clear that Hong Kong investors no longer underestimated Lin Haoran. On the contrary, they seemed optimistic about Hongkong Electric's future under his leadership. Otherwise, they wouldn't be buying up the stock like this. "Yes, it was unexpected for me too," Su Zhixue nodded.
"Zhixue, I'm here today with new tasks for you," Lin Haoran said as he sat down. "Boss, please instruct me." "First, I want you to gather data on the current prices and trading activity of major listed companies, focusing on British enterprises. Second, expand Huanyu Investment's scale, especially the trading team. From now on, we have a lot of work ahead. With the current size of Huanyu Investment, we're playing on too small a scale. You can first merge Wan'an Group's securities division into Huanyu. Also, you can start headhunting from other companies. You know the standards I expect; I'll personally review the final candidates. In short, we have a massive mission ahead. You know I made a fortune from the gold futures market. Now it's time for massive investments. Huanyu's current size isn't enough!" Lin Haoran said seriously.
His goal was simple: spend the entire five billion Hong Kong dollars he had. In the future, as he spent that money, more funds would inevitably come in. After all, he wasn't going to stop making money. Even with only a rough idea of the future, having information decades ahead gave him a tremendous advantage.
"Boss, collecting stock price data is easy. I'll call the stock exchange now and have them prepare a report for us, then fax it here," Su Zhixue said, immediately picking up the phone. Having frequent dealings with the exchange, he already had contacts there.
While waiting for the data, Lin Haoran and Su Zhixue discussed the upcoming investment strategies. After all, Su Zhixue would be the one to execute them. Lin Haoran trusted him a lot; since following Lin, Su's loyalty had always been 100%, never wavering.
After about twenty minutes, the Hong Kong Stock Exchange faxed over the report. Lin Haoran eagerly went through it.
"HSBC Holdings, market value HK$14.857 billion." "Hang Seng Bank, market value HK$9.378 billion." "Jardine Matheson Holdings, market value HK$4.283 billion." "Land Holdings, market value HK$7.769 billion." "Hutchison Whampoa, market value HK$4.382 billion." "Swire Pacific, market value HK$3.566 billion." "Hongkong Electric Holdings, market value HK$2.254 billion." "The Hongkong Hotel Company, market value HK$2.212 billion." "Swire Properties, market value HK$2.032 billion." "Hong Kong Telephone Company, market value HK$2.011 billion." "Hong Kong Tunnel Company, market value HK$1.465 billion." "Towngas, market value HK$589 million."
...
"Land Holdings' market value is actually higher than Jardine Matheson's?" Lin Haoran was a little surprised. After all, Jardine was Land Holdings' parent company, yet its own valuation was lower than its subsidiary.
"Boss, that's normal. Land Holdings owns a vast amount of property in Central, the prime business district, while Jardine focuses more on international trade and finance," Su Zhixue explained with a smile.
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