“I heard that Pate Holdings intends to acquire Bayer’s animal health business?”
Zhang Sanshi looked at Zhang Yida with a smile. He was really shocked when he heard the news at first.
A company valued at over a billion dollars went to She Tunxiang to acquire a company valued at at least several billion dollars.
If it were an ordinary person, he might think this person is crazy.
But if this person was Zhang Yida, he wouldn't think so.
But he didn't expect Zhang Yida to be so optimistic about the pet track and even more radical than Gao Ling.
Zhang Yida had a faint smile on his face and said, "Yes, we are negotiating with Bayer."
He also teased Zhang Sanshi: "What? Gao Ling also intends to join the game?"
Zhang Sanshi waved his hand and said with a smile: "I can't compare with you young people. The older I get, the less courage I have."
Zhang Yida doesn't think Zhang Sanshi is timid. It should be Gaoling Capital's position problem.
Gaoling Capital is an investment group that covers the entire process of early, middle and late stages. Its business spans the primary and secondary markets. Although it manages tens of billions of dollars in funds, it cannot spend more than 10% of its funds to acquire a pet medical company.
.
If he really does this, it is estimated that shareholders and investors will hate Zhang Sanshi to death.
With past success, Zhang Sanshi can forcefully promote the acquisition, but that is not necessary.
You will make money wherever you invest your money, so there is really no need to take risks.
"How about the bet?"
Zhang Yida smiled when he heard Zhang Sanshi's question. This was exactly the purpose of his meeting with Zhang Sanshi today.
"The bet might as well end early."
Zhang Sanshi seemed to have expected Zhang Yida to say this, and said with a smile: "If it ends now, wouldn't Gao Ling lose?"
Zhang Yida pursed his lips and was silent for a moment before saying: "There is still one year left, Gao Ling can continue to grab the pet hospital target, and Pate Holdings can also grab it.
But Gaoling can’t grab a Pet.com or Dogfud pet food store.”
Zhang Sanshi understands what Zhang Yida means, which means that Pet.com and Dogfud have become leaders in the pet e-commerce and pet food segments respectively.
A company of this level cannot be born by spending a year's money.
As for pet hospitals, they are basically scattered in China. It can be said that those with money can buy them at will.
The underlying meaning is that if Gaoling Capital is given another year, the bet will still "lose".
Zhang Sanshi straightened up, changed his lazy look, looked into Zhang Yida's eyes, and said: "Pate Holdings wants to acquire Bayer Animal Health and has spent more than 1 billion U.S. dollars.
The bet between us can be voided directly, after all, this is just a gentleman's agreement, there is no need to take it too seriously."
Zhang Yida nodded, agreeing with this statement.
Zhang Sanshi added: "I also understand the principle that cooperation will benefit both parties. The key is that Bayer Animal Health is too big. After it is incorporated into Pate Holdings, how will the equity be divided?"
"It's very simple. You put all the assets in the pet field controlled by Gao Ling and divide the equity according to the assets."
Zhang Sanshi shook his head, "What I mean is that Bayer Animal Health will not be involved, but only let Pate Holdings and Gaoling's pet industry merge."
"Why?"
Zhang Yida looked puzzled, "Incorporate Bayer Animal Health and merge the assets controlled by Gao Ling, and this will become a company worth tens of billions of dollars.
Industry control of the domestic pet industry will fall into the hands of Pate Holdings."
"You are right. Even if Bayer Animal Health is not included, the merger of our two companies will make the new group the leader in the pet industry."
Zhang Sanshi elaborated on his point of view, "Most of Bayer's animal health business is overseas. Why did Bayer sell it?
Because the growth of this asset has basically stalled and its potential has been exhausted.
Gaoling is an investment company and is oriented towards investment returns."
Zhang Yida did not agree with Zhang Sanshi's point of view and retorted: "Although Bayer Animal Health is not as good as Zoetis, which has a market value of more than 40 billion US dollars, and it is not as good as Boehringer Ingelheim, Merck and Eli Lilly, it is also ranked first in the world.
fifth.
What I value most is the veterinary drug research and development institution of Bayer's animal health system, which is currently lacking in all Chinese veterinary drug companies and even the entire pet industry.
China's pet market has been growing rapidly, and pet medical care is the second largest industry segment after food.
Pate Holdings integrates more than 1,000 pet hospitals and holds it in your hand. This is our offline medical store.
Don’t worry about it online, Pate.com is now the largest pet e-commerce company.
Once Bayer Animal Health is acquired, and relying on these resources, Pate Holdings is confident that it will capture half of the domestic pet pharmaceutical market share.
These revenues are passed on to Bayer Animal Health, which can also promote the research and development of related new veterinary drugs, and compete with Zoetis, Eli Lilly and others."
Zhang Sanshi was silent. He generally understood Zhang Yida's logic and wanted to rely on Pate Holdings' advantages in China to drive Bayer's animal health business, further improve pet medicine technology, and strengthen the company's competitiveness.
"Both Zoetis and Eli Lilly have been rooted in the Chinese market for many years, and it is not easy to steal their market."
Zhang Yida smiled and said: “As long as Bayer Animal Health can develop drugs, its pet hospitals will use Bayer’s.
If you can’t even find a substitute, then consider them last.”
Zhang Sanshi thought about it carefully and realized that pet hospitals actually have a sales function, selling dog food and medicines. Generally, when cats and dogs are sick, they go to pet stores or pet hospitals to buy medicines.
The idea proposed by Zhang Yida is indeed very attractive.
From pet e-commerce to pet food, to pet hospitals, and pet drugs, it basically covers the entire industry chain, connecting all upstream and downstream.
Once such a giant company emerges, only a few small and medium-sized enterprises will survive in the domestic pet market.
"If you do this, aren't you afraid that Zoetis and others will sue you for monopolization?"
Zhang Yida laughed and said, "It's not that exaggerated. It's at most equivalent to Penguin for online social networking. Isn't there Momo and Tantan for these products?"
Zhang Sanshi rubbed his eyebrows, penguins in the pet world are indeed very exciting!
Zhang Yida added: "The pet market is expected to reach 200 billion by next year, and it will not be difficult to grow to 300 to 500 billion in a few years.
If Pate Holdings can capture 20% of the market, based on a price-to-sales ratio of 4-6 times, it may become a company with a market value of 160 billion to 240 billion yuan.
This is just the domestic part, more than 90% of Bayer Animal Health’s revenue comes from countries outside China.”
Zhang Sanshi waved his hand and said, "Yida, please stop trying to make excuses for me. It's so difficult to capture 20% of the entire industry's market."
"I think it is very realistic. After the integration of pet hospitals, they will be the leaders in the sub-sectors. Pet e-commerce is already the leader. As for pet food, it is worse than foreign giants such as Mars. When the acquisition of pet medicine by Bayer Animal Health is completed, I am also confident that it will be the leader."
Become a domestic leader.
The four industry leaders cannot capture 20% of the market share?"
Zhang Sanshi has roughly calculated that, regardless of the 20% market, we can still work hard on the 10% market.
If in the next one or two years, the listing can reach a market value of 80 billion to 120 billion yuan, it will be roughly 4-6 times higher than the current valuation of Pet Holdings and Gaoling's pet companies.
"Okay, you succeeded in convincing me."
Before Zhang Yida could finish being happy, he heard Zhang Sanshi say again: "But I have one more condition!"
"What conditions?"
Zhang Sanshi smiled and said, "Gaoling will pay US$1 billion to acquire Bayer Animal Health."
Zhang Yida hesitated for a moment. He had already negotiated with various investment institutions, but now he could only make new plans.