The Li Jiacheng family announced that it would acquire British Water Company for 7.56 billion pounds, acquiring 56% of the drinking water supply capacity in the UK.
At the same time, the Li family and the labor union reached a package plan, which in addition to providing 28 days of paid leave per year, promised an 8% salary increase for employees, and provided full medical insurance and on-the-job training programs to continue to improve employees' professional capabilities.
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After rigorous evaluation:
This move by the Li Group has greatly increased costs and expenditures. The overall investment return rate of the project is less than 1.8%. If operating costs are not properly controlled, it may fall into a loss situation at any time.
At this time, Wang Yaocheng had finished his tour in Europe and flew to Los Angeles on a Boeing 77 special plane.
Sitting comfortably in the Mediterranean manor, Wang Yaocheng got inside information about the Li family's capital blocking the royal family fund.
The message shows:
Since the royal family fund swept Hong Kong's Cheung Kong Holdings and Hutchison Whampoa, Mr. Li Ka-shing, who is in his eighties, has been hit hard. His health is worrying and he has been bedridden for many years.
His family business is led by his eldest son Li Zeju, including investments in the energy industry in North America and public sector investments in Europe.
Blocking the acquisition of All-English Water was partly due to the Lee family's strategic capital investment needs, and partly due to personal grudges.
According to insider information, when the Royal Family Fund raised its offer again, Li Zeju, who was in charge of the merger and acquisition, categorically rejected the old minister's suggestion to give up and chose to increase the offer, ultimately winning the beauty back.
He suffered heavy losses at the hands of Wang Yaocheng one after another, leaving a huge shadow in the heart of Li Zeju, a wealthy young man who had always had a smooth life.
Perhaps in Li Zeju's heart, he always had an obsession to compete with Wang Yaocheng, which is why he made such an irrational decision.
Judging from the performance of this business war, Li Zeju is just a mediocre businessman, and his ability and business wisdom are not enough to dominate the world's financial circles.
in Hong Kong Island
When Li Jiacheng heard about it in the hospital bed, he almost vomited out a mouthful of old blood, and his condition immediately worsened. Brothers Li Zeju and Li Zekai flew back to Hong Kong on a special plane overnight.
Think about it too
The acquisition price of 7.56 billion pounds is equivalent to almost 90.8 billion Hong Kong dollars. Coupled with the promise of salary increases and benefits for the 22,500 employees of the British Water Company, the cost is more than 100 billion Hong Kong dollars.
The original profit of only 375 million pounds per year will therefore be a large part of the employee benefit plan, which is simply not worth the gain.
It can be said that it is a waste of money to invest hundreds of billions of net worth in exchange for such worthless assets.
The characteristics of the public utility field are very obvious, with large investment returns and a long return period, stable customers, and stable income.
British Water's annual profits are stable between 375 million and 400 million pounds, and the number of customers and profits are relatively stable, with little change for 15 years.
Because it is related to the national economy and people's livelihood, the government strictly controls prices, and it will not be easy to adjust the price of water supply.
Mr. Li rashly agreed to the union's demands for a salary increase and a series of welfare plans, with disastrous results.
Following Dong Shi's example, Li Zeju invested huge amounts of assets into the British Water Company, which can be said to be a fatal failure.
After all, compared with the size of the Royal Family Fund, the Li family pales in comparison.
As of the end of the second quarter of 2006, the cash flow of the Royal Family Fund had exceeded US$222 billion, which does not include the tens of billions of US dollars in assets of the family trust fund.
The consortium owns a large number of high-quality assets and continues to contribute cash revenue of up to 60 to 70 billion U.S. dollars every year.
On this basis, a wealth preservation and appreciation plan is proposed.
On the other hand, what does the Li family have?
After losing the holdings of Cheung Kong Holdings and Hutchison Whampoa, the Lee family cut their weight on the Hong Kong Stock Exchange and gradually sold out their equity holdings in exchange for a large amount of cash flow.
In other words, the Li family now has no pillar industry. In addition to tens of billions of Hong Kong dollars invested in various parts of the world, hundreds of billions of Hong Kong dollars are locked up in British water companies, but they cannot get the benefits they deserve. They are sitting on nothing.
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Once there is trouble, the results can be imagined to be disastrous.
The Royal Family Fund is different. According to the investment plan, even if there is a financial crisis and the assets invested in the British Water Company suffer huge impairments, it can still obtain stable income of 375 million to 400 million pounds per year.
As long as the economic crisis is over, the value will naturally return within a few years. The so-called asset impairment is just a numerical change on the books. Compared with the huge cash flow held by the royal family fund, this asset change has nothing to do with the overall situation.
Wang Yaocheng is certain that Li Ka-shing, who has been in business for a long time, can definitely see this, but the eldest son Li Zeju is not necessarily sure.
After backhanding the Li family, Wang Yaocheng felt refreshed.
He put down the materials in his hands and turned his mind back to the current important work item.
The first is to launch a plan to reshuffle the electronics and semiconductor industry.
The second is to usher in a new era of smartphones.
The third is to launch a North American fixed asset sell-off plan to reserve enough ammunition to survive the upcoming financial winter.
Today, Wang Yaocheng will meet with Ray Dalio, a famous Wall Street investor from Bridgewater Associates.
This investment master is a tall, thin and tall old man with deep eyes. When he saw Wang Yaocheng, he nodded in a very serious manner: "I am very happy to meet the legendary king of wealth. I hope to have a serious discussion with you. The United States is about to
Facing a serious financial crisis.”
"Haha, please sit down, Mr. Rey, I am very interested in your views."
"This is not an opinion. This will be a global financial disaster caused by the U.S. subprime mortgage crisis. It will break out in 2008 at the latest. The subsequent serious crisis will affect everyone in the world. I hope you can use your ability.
Its worldwide influence reminds the world to avoid financial risks."
"Ahem, um...Mr. Rey, you have enough time to convince me today that you have, uh...unconventional remarks. We can have an in-depth discussion on this issue. As for what you said...we
We can leave the discussion to the next step.”
At this moment, Wang Yaocheng almost felt that he had traveled through time as he looked at Mr. Rey's burning words.
Why are you so sure, Mao, that the financial crisis is about to break out in 2008? What are your reasons?
Even if you could predict something, it wouldn't be so accurate, would it?
As a well-known investor on Wall Street, Mr. Rey holds the $7.8 billion Bridgewater Investment Fund. He is a very famous data analyst on Wall Street and has always been known for his rigorous and rational investments.
Ray Dalio is very famous for never investing in high-tech Internet companies, which coincides with the Wall Street investment god Buffett.
His views are equally insightful:
I can't put a precise price on these network high-tech companies. These companies are like congenitally deficient deformities.
I have no idea where their profit model comes from or why they are so popular.
If I just like Internet high-tech companies, I would rather like them on the blog than invest real money, because it may mean losing all my money.
Ray Dalio represents the rational investment school on Wall Street. If they are investors, they are actually more like data analysts or mathematicians. They abandon all rational thinking and are accustomed to speaking with cold data.
Therefore, Wang Yaocheng did not have much contact with such people, and their mutual understanding was lackluster.
The key is
As a player who has peeked at the hole cards, Wang Yaocheng must have a solid reason to explain his series of measures to avoid the upcoming financial risks in 2008.
therefore
Investor Ray Dalio, who is considered an outlier on Wall Street, would be a good shield.
He firmly believes that there will be a serious financial crisis caused by the subprime mortgage crisis in 2008, and he writes books and talks to promote his views everywhere.
Ray Dalio even visited the White House to meet with Treasury Secretary Paulson and explain his sensational conclusions. Naturally, he was not taken seriously and was considered a sensationalist.
He told Paulson in a serious tone:
The United States may face a serious credit crisis, especially as Lehman Brothers' subprime debt is playing with fire. In this financial crisis, many large banks will be on the verge of bankruptcy.
Ray Dalio foresees that the banking system will record astronomical losses. The disaster may occur at some time in 2008. It is not too late to make amends now.
However, under the resistance of the mainstream will of Wall Street, no one really took the old man's words to heart.
The U.S. imports have increased significantly, which may ignite consumption enthusiasm, economic growth continues to improve, and tax revenue increases, thereby encouraging the government's budget deficit.
A trade war could shift our deficit from one pocket to another.
Additionally, an overheating economy could force the Fed to raise interest rates rather than cut them, something few would think of right now.
The disaster originated from this. The subprime loan crisis in the prosperous United States accumulated sharply, and the risks were increasing at the same time. This bubble became bigger and bigger through the securities market.
As all accidents will happen, once the subprime loan crisis breaks out, it may severely impact the market, and may cause hundreds of thousands of people to become homeless, and the wealth they have worked hard to accumulate will be reduced to zero overnight...
Rey Dalio became excited as he spoke, waving gestures vigorously to support his point of view, which made Wang Yaocheng feel quite uncomfortable.
He is definitely not a good speaker. He is always trying to impose his views on the audience. Such a person is either a genius or a madman.
"Well, Mr. Rey, through frank communication with each other, I very much agree with your views, but I may have different opinions on some of the decisions."
Wang Yaocheng stopped Rey Dalio's rambling remarks. He now knows what the problem is:
This guy is so confident in himself that anyone who dares to question his judgment is either a fool, an idiot, or both.
If you communicate with others with this attitude, even if you hold the truth, it will be difficult for others to accept your arrogant attitude.
If it really happened, Wang Yaocheng could have predicted the 2008 subprime financial crisis in 1991 because it was a disaster that had happened before in history.
He will definitely be considered a lunatic beforehand, and he will definitely be regarded as a prophet afterwards.
Wang Yaocheng does not dare to be so arrogant. Even if he knows that what Rey Dalio said is true, he will take the initiative to refute it, causing a heated debate.
I believe this will soon spread to Wall Street. In addition to adding some laughter to those arrogant investment elites, Wang Yaocheng hopes that these companies will sink as deep as possible.
Haha, colleagues are enemies!
Wang Yaocheng said with a humble smile on his face: "Mr. Rey, I respect your research results very much, but I feel that in today's booming economic development situation in the United States, talking about the financial crisis may be a bit... Oh, it is an exaggeration.
"
"watt?"
Rey Dalio's mind was immediately filled with black threads. He became excited when he heard this, and he fired sentences continuously like a machine gun:
"Oh Maika, you disappoint me so much."
"With your lofty status in the international business community, I believe you can keenly detect the huge crisis that exists. The U.S. economy is currently in a raging fire and it is absolutely unsustainable."
Wang Yaocheng interrupted when the other party was excited about his speech, frowned and said: "I don't agree with your view. Imports in the economy have increased significantly, which shows that the United States has a strong willingness to consume, which will further stimulate economic growth and may usher in a new era."
A decade-long period of prosperity."
"Oh my God, that's the most ridiculous thing I've ever heard."
Rey Dalio was so excited that he jumped up and said with a red face: "You have only seen the superficial phenomenon. All this is like a flower in a dream. The moon is unsustainable. Recent data shows that the number of new housing starts in the United States
Reaching 2.2 million, booming consumption further stimulated the economy."
"Please wake up, this is all superficial. The profit-seeking Wall Street has drawn all blacks and South Americans who have no spending power into the consumer army, and used subprime loans without any threshold to rob this group of people with poor credit ratings."
Be included in the ranks of consumers.”
"This is simply ridiculous. People who don't even have $500 in their pockets can buy a house worth $300,000. Isn't this an extremely dangerous risk?"
"Once the Federal Reserve's financial policy changes, the market changes, or even a routine layoff at General Motors, this bomb will detonate, blowing everyone to pieces..."
"Ahem, Mr. Rey, the United States has the most powerful financial system in the world, and has an unparalleled economic scale in the world. We must believe in the huge endurance of the U.S. economy..."
"That's enough, King Boss, your foresight really makes me laugh. The famous King of Wealth is so short-sighted. This disappoints me so much. Please forgive me, I can't share my research results with you. It's possible that I
Coming here is a mistake and a total humiliation."
"Oh, Rey, I am honored to hear your wonderful views today, and I am very grateful that you are willing to share your judgment on the world's financial landscape. Although I do not accept 100% of your views, I am at least partially convinced by you..."
"Boss King, there is no need to pretend to say things you don't mean in front of me. It was a mistake for me to come here today. I'm sorry to say goodbye."
"No, Rey, I have prepared a sumptuous dinner for you..."
"Save your dinner, you will regret it."
Rey Dalio left angrily. Wang Yaocheng looked at the thin back of the old man leaving and couldn't help but bow deeply to see off this cute and grumpy old man.
For various reasons, Wang Yaocheng cannot agree with his remarks in public, but it does not prevent him from showing respect. He is a fighter who insists on his own philosophy of life.
Specifically, Ray Dalio is a representative figure in Wall Street's data analysis stream.
This school does not rely on perceptual analysis, but entirely uses mathematical models to analyze the growth and decline of the economy, looks for similarities and differences in economic laws from historical data, predicts the future through proprietary mathematical models, and guides investment decisions.
In fact, Wang Yaocheng has more detailed figures in this regard. Among the new housing users in the United States, subprime credit customers account for 54.6%. What does this mean?
It means a huge tinderbox that will explode at any time due to policy changes, blowing everyone involved in subprime lending into powder.
These subprime credit customers say they are good if they have $500, but some even spend all the money in the next 50 years, which means they are simply insolvent.
Among these customers with extremely poor loan credit, there are many with criminal resumes. Most of them are penniless and would even kill someone on the street for $20, but they can buy hundreds of thousands of dollars worth of money with a social letter of credit.
of houses.
And those well-dressed Wall Street elites took the subprime loan asset package launched by the bank to pass on the crisis, whitewashed it, listed it on the market to make huge profits, and subcontracted it layer by layer.
In this process, Wall Street has undoubtedly made huge profits, but it has continuously amplified the risks and played a game of beating the drum and passing the flowers around.
Don't they see the crisis?
The answer is: No.
As Wall Streeters who have received elite education, everyone sees the dangers hidden in them, but they all turn a blind eye because of the blindness of their interests.
I only care about making money in my own pocket, so why should I care about other people's lives?
Wang Yaocheng lit a cigar in his office, letting the rich smell of cigar smoke fill the air, his eyes looking complex and cold.
Seriously speaking, most of the consortium's wealth comes from the American market. Whether it is Internet high-tech companies, Atlantic Business Machines, or Marvel Animation, they have all brought rolling wealth to the consortium.
But speaking of one thousand, preaching of ten thousand.
The Wang Consortium is also an outsider in the American market. It will not and cannot be accepted as one of its own now and in the future. After all, it is just a passer-by.
When the prosperity is gone, it’s time for the music to end and everyone to disperse.
Although he couldn't bear it, Wang Yaocheng still forced himself to harden his heart. After all, the upcoming financial crisis would be a pie in the sky for the entire Wang Group.
The complete and complete layout of the entire consortium depends on the huge destructive power of this financial crisis.
When there are chicken feathers all over the ground, it’s time to celebrate the harvest.
No choice, we still have to catch this big fat sheep and work hard to get the wool.