Chapter 348 346 [Spending Money Like Water]

Saturday, June 1977, 9

Li Wendi boarded a plane to America accompanied by William from Citibank and his newly hired foreign bodyguard and translator.

Before the plane took off, William, who was sitting next to him, reported to Li Wendi about the acquisition of Haifeng Bank. "We, Wan Guo Bao Tong Bank, have made preliminary contact with Mr. Matthew, the largest shareholder of Haifeng Bank, on behalf of you, Mr. Li. Mr. Matthew is not very satisfied with the acquisition price of $12 per share. He hopes that Mr. Li can raise the price to $18 per share. They have no objection to the issuance of new shares and other aspects."

The current share price of Haifeng Bank is US$10, and US$12 is already a 2% premium. Unfortunately, the shareholders of Haifeng Bank are not satisfied and also want to use this to push up the market share price.

Haifeng Bank will naturally have no objection to the share price of the new shares. These dollars are not going into their pockets, but will only affect Haifeng Bank's future financial problems. Without sufficient funds, Haifeng Bank will not be able to get out of its predicament.

"Okay, I know about the price. I will negotiate with Mr. Matthew in person." Li Wendi knew that Citibank would not do its utmost to help. This was not their own business. Why should they offend Matthew and his people for the sake of their boss? Moreover, Citibank was just a messenger and had no power to decide matters.

"According to the investigation of the headquarters, the bad debt amount of Haifeng Bank is as high as 1.3 million US dollars, which is three times the profit of Haifeng Bank at its peak. If Mr. Li wants to improve the operating conditions of Haifeng Bank, he needs to inject at least 3 million US dollars. Based on the calculation of acquiring 1.4% of the shares at 18 US dollars per share, Mr. Li needs to invest 25 million US dollars." William said.

Li Wendi was thinking to himself that he had a total of 4.5 million US dollars, and he needed to pay about 2 million US dollars, leaving 2.5 million US dollars. The current US stock market was not good, and he could buy at the bottom with a large amount of money, but the rate of return would not be too high. In addition, the Iran-Iraq War in two or three years would affect the US market again.

Therefore, Li Wendi is still reluctant to invest in US stocks, even though now is one of the opportunities to buy at the bottom.

"Mr. William, the current gold price is $126 per ounce. I wonder if Citibank can help me buy $2 million worth of gold and store it in the bank's safe?" Li Wendi asked.

After much thought, it is still easier to make money from gold. By the early 80s, the price of gold reached US$825 per ounce, which is nearly 6 times the profit, which is really scary.

2 million US dollars is enough to turn into more than 10 billion, and with investment in Hong Kong's gold market, Li Wendi can completely achieve personal financial freedom.

William was a little surprised. He didn't expect Li Wendi to be so optimistic about the gold market. An investment of $2 million was enough for him to make a great contribution to the headquarters. However, he wanted to "hold on to Li Wendi's thigh" instead of returning to the headquarters.

"Of course you can. However, Mr. Li, the gold purchased for 2 million US dollars weighs 158.7 million ounces, and the storage cost is 100 million US dollars a year," William reminded.

"No problem!" Li Wendi said with a smile. It was only 100 million US dollars, just a drop in the bucket.

After the plane took off, as the flight would take 16 hours, Li Wendi put on an eye mask and fell asleep.

When he woke up, it was already dinner time, so he began to think about the negotiations with Haifeng Bank and how to run Haifeng Bank well as soon as possible so that he could sell it at a good price.

A five-star hotel in New York
Li Wendi did not start negotiations with Haifeng Bank immediately because his team had not yet arrived.

However, Li Wendi did meet with Matthew Helen, the major shareholder and actual operator of Haifeng Bank.

The beautiful piano sound echoed in the hall. Li Wendi, Matthew and William took their seats in a triangle shape, and the translator sat next to Li Wendi.

Matthew knew a little about Li Wendi, the buyer. He was only interested in getting out of the quagmire of Haifeng Bank as soon as possible. Other things had nothing to do with him. "Mr. Matthew, the purchase price of $12 is already very good, with a 2% premium. If it is $18, the premium is 8%, which is very inconsistent with the market rules." Li Wendi said seriously.

Matthew, who is tall and strong, is not a simple-minded person, but a banker with rich financial experience. He looked at Li Wendi and said calmly, "The share price of Haifeng Bank is indeed not high, but Haifeng Bank is the sixth largest bank in New York City, with branches all over the United States, and has a very good reputation in the financial industry. I think this is the most valuable thing of Haifeng Bank."

Li Wendi hit back, "Haifeng Bank is not small in size, but its debt is a problem that cannot be ignored. Even the Federal Reserve will go bankrupt if it is heavily in debt, no matter how powerful it is."

The two continued to argue for a while, and Matthew finally gave in and said, "Okay, Mr. Li, I'd like to be your friend. How about $16 per share?"

Li Wendi still shook his head and said, "14 dollars a share!"

"No, Mr. Li! This price is too low. The lowest we can accept is $15 per share. This is our reserve price. If it is lower than this price, our transaction may have to be stopped." Matthew stared at Li Wendi and said.

"OK! Mr. Matthew, let's make it $15 per share. Let's have a pleasant cooperation!" Li Wendi saw that the price was almost the same, and there was no need to continue haggling over such a small difference in money.

Moreover, the share price was US$5 less than when HSBC acquired Haitong Bank in the previous life, saving US$1550 million, which is a very large sum of money.

The next morning, Li Wendi's team arrived. Li Wendi did not let them start work right away, but gave them a day off to rest. They officially started work on the afternoon of the third day.

Since Li Wendi had discussed it with Matthew, the leader, the next task was not very difficult, but it was somewhat complicated and would take some time.

Therefore, after 5 or 6 days, the team finally got a clear understanding of the financial and operational situation of Haifeng Bank and officially entered the signing process.

After obtaining 25% of the shares, Li Wendi became the largest shareholder of Haifeng Bank and immediately convened a new round of board meetings.

There were many difficulties during the meeting. Some foreign directors did not approve of a Chinese being the chairman of the board of directors of Haifeng Bank. They didn't even show any courtesy and directly asked Li Wendi to get out of the board of directors.

Li Wendi has always been a "bully" and how could he tolerate provocation from such a person? After seeking advice from his lawyer, Li Wendi immediately asked security to come in and remove this guy from the board of directors.

Such behavior naturally let the directors know that Li Wendi's methods were powerful, but it could not truly solve the existence of discrimination. After all, Li Wendi did not have full control of Haifeng Bank.

With Matthew's support, the plan to issue new shares was successfully passed, and 666.7 million new shares were issued privately to Li Wendi. In this way, Li Wendi would hold 51% of the shares and become the actual controlling shareholder of Haifeng Bank.

After taking control of Haifeng Bank, Li Wendi asked someone to make an announcement, but unfortunately it had little effect on stimulating the stock price, which only rose to 11 yuan, a 10% increase.

Li Wendi knew that in order for Haifeng Bank to quickly return to its peak state, it was necessary to increase the confidence of the American people in Haifeng Bank, thereby increasing the amount of deposits in Haifeng Bank and developing lending business.

Unfortunately, Haifeng Bank is going to be transferred. If it could continue to operate, Li Wendi would definitely hand over all the US$2.5 million in his hands to Haifeng Bank for management, so as to increase the company's credibility.

(End of this chapter)