Bayer Global President Werner Baumann received Zhang Yida and his delegation from China at the headquarters.
Accompanying Zhang Yida are financial advisors and legal advisors such as Shen Beipeng, Zhang Sanshi, and Robert from Goldman Sachs.
In a very luxurious conference room, after shaking hands warmly, both parties sat down on both sides of the long conference table.
Werner Baumann smiled and said: “On behalf of the Bayer Group, I would like to extend a warm welcome to the arrival of Mr. Zhang and his delegation.
But there are some things I still don’t want to say. Your representative has been negotiating with us for half a year, and we have not yet reached our psychological price.
Coincidentally, Eli Lilly Animal Health also expressed a certain interest in Bayer Animal Health at this time.
In view of the first-come, first-served order, I decided to talk to you again. If the price we are not satisfied with is still not reached, we may have to choose Lilly Animal Health."
Zhang Yida couldn't understand German, so he was translated by a business translator.
Zhang Yida, Shen Beipeng, and Zhang Sanshi looked at each other, and Zhang Sanshi said: "Mr. Baumann, Eli Lilly also has a pharmaceutical business, and it is a competitor with Bayer.
Our Chinese consortium has no conflict with Bayer in this regard."
Bayer's translator translated Zhang Sanshi's words to Bauman, and Bauman replied with a smile: "Bayer is not afraid of any competition, and it is okay to sell its animal health business to any company.
We only look at the price, and whoever pays the price gets it.”
Zhang Sanshi frowned and shot out a salute on the way, which was a bit troublesome.
Zhang Yida asked: "I wonder what kind of acquisition conditions Eli Lilly offered Bayer?"
"$5 billion in cash, plus $2 billion in stock."
Bauman was very candid and quoted the price directly. Then he looked at the Chinese group and saw that they all had expressionless faces and could not tell anything.
"The US$6.6 billion offer we made is all in cash. For Bayer, which just acquired Monsanto, cash is the most urgent thing, right?" Zhang Yida asked.
Baumann smiled slightly, "The price we paid for acquiring Monsanto was US$62.5 billion, and the cash brought in from selling the animal protection business was just a drop in the bucket.
We have no shortage of cash, but what matters more is the quotation. If you are willing to pay a certain percentage of stocks as the transaction consideration, that is fine."
Zhang Yida knew that what the other party said was true. It is understood that in order to complete the acquisition of Monsanto, Bayer conducted a phase of bridge financing of US$57 billion, including equity and debt.
This is a real giant, one of the three giants of agricultural fertilizers in the world, and the world's largest producer of seeds and pesticides.
Its competitors are all at the level of "DowDuPont" and "ChemChina-Syngenta".
This is only its agriculture and fertilizer businesses. Bayer's polymer materials and pharmaceuticals businesses also have a large size.
Zhang Yida understood what Pinbaoman meant, and he probably wanted his side to bid with Lilly.
This kind of bidding is very detrimental to one's side and is not transparent.
So Zhang Yida said: "It's better to let Lilly bid openly with us."
Bauman's eyes lit up and he nodded, "Okay, this is exactly what I want."
…
Back at the hotel, Zhang Sanshi, Shen Beipeng, and Zhang Yida started discussing.
"Yida, I'm not saying the bidding is wrong. After all, this company is in someone else's hands, and they are free to sell it how they want."
Zhang Sanshi held a glass of red wine and talked about his opinions.
Gaoling Capital wants to invest US$1 billion in this deal. This is the investor's money, so he must be cautious.
"I think Bayer is still determined to sell its business, but it just wants to wait for the price."
There have been many large and small mergers and acquisitions that Shen Beipeng has handled, and Shen Beipeng has a somewhat clear understanding of some situations.
"Yes, just wait for the price."
Zhang Sanshi said, “We must add a cap to this price.
We are here to make money from Bayer's animal health business, but the price is beyond our psychological level, so we would rather not buy it."
"Then let's talk about your psychological price."
Although Zhang Yida really wanted to buy Bayer Animal Health, Zhang Sanshi was right. You buy it to make money. If you can't make money, it's better not to buy it.
"Bayer Animal Health had a net profit of US$400 million last year. Considering the slowdown in business growth, I think it is more appropriate to have a valuation of no more than 20 times PE."
Shen Beipeng nodded in agreement with Zhang Sanshi's point of view, "After acquiring Bayer Animal Health, relying on Pate Holdings and Gaoling's layout in China's pet industry, it is inevitable that Bayer Animal Health's revenue will see a certain growth.
But this growth belongs to the dividends after our acquisition and cannot be included in the transaction.
8 billion US dollars is quite a lot. Don’t look at Baumann’s lack of money. In fact, Bayer’s debt is very high.
The all-cash terms we offered are actually very attractive and are also a big advantage for us.”
Zhang Yida nodded, "Okay, let's set the upper limit at US$8 billion. If it exceeds this line, we will give up."
…
I stayed in Germany for two more days and finally waited for the bidding negotiation meeting held by Bayer.
In addition to a group of blond foreigners, there are also a group of Asians with black hair and black eyes.
As he got closer, Zhang Yida saw that this was a group of Chinese people...
The revived boss Guo Kuangchang also greeted Zhang Yida, Shen Beipeng and Zhang Sanshi.
"Guys, please don't blame Fuxing for joining in the fun.
In fact, I have always been interested in the pet industry, but I have never seen a suitable target.
After Bayer heard about our interest, they invited us to attend the meeting.”
Zhang Yida smiled and waved his hand, "How can you blame me? This is a business matter where everyone competes freely."
Zhang Sanshi secretly said something bad. There are many business segments in the revitalization business. It started with real estate and medicine, and later developed into comprehensive investment.
The acquisition of Bayer Animal Health has enough motivation and strength, so it is not easy to deal with!
Shen Beipeng chuckled, "Let's all use our own methods! But don't let us fight among ourselves and let foreigners take advantage."
Guo Kuangchang grinned, "Mr. Shen is right, I will pay attention to it."
Bauman walked onto the stage and said with a smile: "Everyone is here, let's officially start!"
A Bayer staff member began to explain the starting bidding rules, "The base price is US$7 billion, and each increase must be no less than US$50 million..."
"$7.05 billion!"
The people from Eli Lilly seemed determined to win and were the first to start quoting.
"$7.1 billion!"
Not to be outdone, Guo Kuangchang began to increase prices.
"$7.5 billion!"
Hearing that Zhang Yida had added US$400 million in one go, people from Guo Kuangchang and Eli Lilly looked at him with suspicion.
Especially Guo Kuangchang, he was very depressed. He simply didn't regard money as money.
Shen Beipeng had the nerve to remind himself not to take advantage of foreigners. What is Zhang Yida's approach called?
"$7.55 billion!"
The people from Eli Lilly hesitated for a moment and then started a new round of quotations.
"$7.6 billion!"
Guo Kuangchang has a firm vision. He has carefully considered the purchase of Bayer Animal Health, and the price is still affordable.
The man from Li Lai stopped talking. He didn't know whether he was waiting for the opportunity or giving up completely.
"$7.65 billion."
Zhang Yida calmly spit out a number.
Guo Kuangchang glanced sideways at Zhang Yida, expressionless, and continued to increase the price.
…
"$8 billion."
After reporting this number, Zhang Yida still looked relaxed on the surface, but he was actually not calm inside.
He glanced at Guo Kuangchang. If the other party wanted to increase the price, he would have to give up.
Guo Kuangchang took a deep look at Zhang Yida and sighed: "We give up!"