Ruixiang summoned all shareholders, and in the large conference room, Zhang Yida personally announced the proposal to merge with Zhonghe Group.
This news was no less than a bombshell dropped among the crowd, shocking all shareholder representatives.
Masayoshi Son, who was present in person, was overjoyed when he heard this. SoftBank was both a shareholder of Ruixiang and a shareholder of Zhonghe, and the merger of the two was in line with his wishes.
"Mr. Zhang, this decision is wise and I support it!"
With Masayoshi Son taking the lead in supporting, Blackshirt Capital and Zhenke Fund also expressed support for this decision.
Other shareholders don't have much opinion. They only care about whether they will suffer losses during the merger process.
Tong Shihao from GGV Capital said with a smile: "We are not opposed to the merger. The key is how much to value Ruixiang and how much to value Zhonghe. There must be a clear explanation for this!"
Qiming Venture Partners Gan Renping, who has a good relationship with Tong Shihao and often invests in the same project, also said, "I agree with the statement of the GGV representative. Valuation involves everyone's vital interests and must be judged in a scientific, objective and fair manner.
."
Other investment representatives also echoed their voices. Some suggested hiring an independent third-party agency, some said it should be calculated according to the PE valuation method, and so on.
Zhang Yida pressed his palms in vain, and after everyone calmed down, he slowly said: "I know what you mean, don't worry, I, Zhang Yida, still have a good reputation in the venture capital market, and I will never do anything like those who are just trying to get the upper hand."
Things of small profit.
Ruixiang and Zhonghe indeed have many common shareholders, and I am the major shareholder of both companies.
Therefore, the suggestion just made by Mr. Robert from Goldman Sachs is very appropriate. We hire an independent third-party agency to do the valuation calculation.
In order to prevent the data from being inaccurate, we can invite several more companies, all of which are well-known institutions at home and abroad.
It doesn’t matter if you spend more money, the main thing is to do things beautifully and satisfy every shareholder.”
Robert was quite happy to see Zhang Yida taking his suggestions. He had been making friends with Zhang Yida in order to secure the underwriter qualification in the future and the private placement business that might appear after the listing.
Looking at it now, the effect is very good, and Mr. Zhang still approves of himself.
Being overtaken by Robert, shareholder representatives from Bank of America Merrill Lynch Wang Zheng, Morgan Stanley Evans and other investment banks were a little unhappy.
They have just been stunned by the huge news and are fantasizing about when this new group will go public, how much money it will raise from the listing, how much underwriting fees they can get, and how much bonus they can get from it.
As a result, they were tricked by the old boy Robert again, which put them under great pressure!
It seems that the next step is to establish a good relationship with Mr. Zhang so that he can have a drink of soup after the listing.
After all shareholders reached consensus, Zhang Yida emphasized that the information must be kept confidential and no leaks should be allowed.
All the shareholders nodded, not only because they signed a confidentiality agreement, but most importantly because they were afraid that if exposed, their reputation in this industry would be completely ruined.
Then there was a high-level meeting. Zhang Yida convened the general managers, vice presidents, and subsidiary CEOs of each major business group to announce the merger decision made by all shareholders.
The shareholders all agreed, and they, a group of professional managers, naturally had no objections.
Although he was a little surprised, he didn't ask any questions.
…
"Why? Mr. Zhang, I think now is not a good time for merger."
Somewhat beyond Zhang Yida's expectation, the biggest resistance to the merger came not from Ruixiang, but from Zhonghe's side.
Zhang Yida, Xu Xiaoming, Shen Beipeng and others looked at Zhang Liping, chairman of Blackstone Group Greater China, in confusion, wondering what the old man was thinking.
"Zhang, isn't merger a good thing? In an old Chinese saying, this is called a strong alliance!"
Bao Zheyu, head of BlackRock Asia Pacific, turned his head and looked at Zhang Liping sitting next to him in confusion.
“Pinduoduo’s monthly GMV exceeded 40 billion yuan, Doushi’s daily active users exceeded 300 million, Kuaishou’s live broadcast revenue exceeded 1 billion yuan in a single month, and Musical.ly became popular all over the world…
Zhonghe Group's various businesses and revenue have been growing rapidly, and I have not seen the specific financial report of Ruixiang's revenue growth, but I can also infer something from some details.
With the tightening of financial regulatory policies, the funding sources of Yongbei and Daibei will be severely restricted, which is expected to have a serious weakening effect on the revenue growth rate of Ruixiang Group.
With all due respect, I think the merger is a bit of a disadvantage now."
Zhang Liping glanced at Zhang Yida and other shareholders, catching everyone's expressions of surprise, deep thought, and confusion.
He continued: "One is a company whose growth has gradually slowed down, and the other is a company whose revenue has doubled several times a year. You can compare it yourself.
Would it be better if the merger was postponed to next year, or the year after that?
For our shareholders of Zhonghe, this is the real maximization of interests."
Zhang Yida felt that he had underestimated this silver-haired old man. He had extraordinary experience!
With the development of foreign credit card payment, coupled with the restrictions and resistance to Chinese mobile payment companies from countries led by the United States, it is difficult for Ruixiang's mobile payment to reach a new level.
Therefore, Ruixiang has been transforming into technology fields, such as cloud computing and AI, but it started late and has a weak foundation. It has not achieved very good results so far.
Moreover, in China, there are also Leech Financial Services and WeChat Pay watching closely, and the development has basically reached its peak.
Many of Zhonghe Group's businesses have only begun to be commercialized, and their growth potential is still huge.
Zhang Liping, an old man, is right when he says that Zhonghe has greater development potential.
But it is true that Zhonghe burns money quickly. In addition to Blue Hole making money, short videos can only be said to have achieved revenue balance. Large entertainment, digital content, e-commerce and other sectors still require long-term and large investments.
If Zhonghe Group wants to achieve full revenue balance, I'm afraid it will have to conduct one or two more rounds of financing.
Thinking of this, the shares will be diluted anyway, so it is better to merge Ruixiang into it. There will be no need to raise funds later and it will be listed directly.
After 18 years in the previous life, the environment of the securities market was not very good. If we really have to wait until 2020 or later to go public, the environment we may face will be even worse.
These are Zhang Yida's true thoughts. He originally wanted to postpone the merger for another year and a half.
But when I thought about it carefully, I realized that after the merger, we still had to integrate the business, including the pre-IPO sprint, which was a bit too late.
The integration work must be completed this year before it can be fully launched next year.
There is no need to elaborate these truths to others. Zhang Yida knows what the shareholders headed by Zhang Liping are thinking.
"Oh, by the way, April is coming to an end soon. Isn't it time to settle the bet between Zhonghe, BlackRock, and Blackstone?"
I don’t know whether Zhang Liping did it intentionally or unintentionally, but he never mentioned the advertising revenue of DouShi, so Zhang Yida had no choice but to remind him.
Zhang Liping twitched the corner of his mouth and glanced at Bao Zheyu, who shrugged at him, with a look of helplessness on his face.
"Mr. Zhang, we will discuss this matter later. Don't worry, we, Blackstone and BlackRock, are world-renowned investment institutions and will never default on their debts.
What we are discussing now is the merger, let’s resolve this matter first and then talk about other things!”
Zhang Yida nodded, "Okay, let's talk about the merger first."
Zhang Yida looked at the investors sitting on both sides of the large conference table and said calmly: "Everyone is afraid that Zhonghe Group's valuation cannot be fully reflected, right?
This matter is simple, we just ask Ruixiang Group to give us a high price!"
If you say high prices, then high prices? Zhang Liping shook his head repeatedly, obviously not agreeing with Zhang Yida's statement.
He said very seriously: "Mr. Zhang, I know that Ruixiang is also under your control, but Ruixiang also has many shareholders, so it's impossible for them all to listen to you, right?
If you ask for a valuation of US$100 billion, will people agree?"
Zhang Yida chuckled and said, "I would agree! Can't it be enough for all the shareholders of Zhonghe Group to participate in a round of betting?"
Looking at the pensive shareholders, he added: "If you want to sell at a good price, you have to pay something, right? You want to take advantage but don't want to take responsibility. There is no such thing as this!
Let me state it first, those who do not participate in the gambling are not qualified to enjoy the fruits of victory!"
Zhang Liping and Bao Zheyu looked bitter, and the taste was so familiar, exactly the same as last year!