Although the company completed the shareholding system reform as early as 1997, in Zhejiang, where private enterprises are strong, regional real estate "rising stars" like Dumei in Zhejiang have to wait patiently for the initial public offering (IPO).
Wen Zhanghua understands the leverage of capital on enterprise growth and is also looking for opportunities to enter the capital market. Since 2000, Dumei, Zhejiang Province has talked with the major shareholders of several listed companies about buying shells, but they are not familiar with the relevant operations and lack of professional manpower, and all ended in failure.
Zhejiang Rheinda Investment Co., Ltd., which is almost on the same starting line as Zhejiang Dumei, successfully borrowed "Liaofangtian" (stock code 000558, later renamed as "Rheinland Real Estate") in just three months on 200 1. Through a series of operations, the scale benefit has been greatly improved, which undoubtedly touched Wen Zhanghua deeply. In May, 2002, Wen Zhanghua found Gao Jiang, the planner of the "Rheinda-Liaofangtian" merger case, and formally entrusted China Enterprise Oriental as the financial consultant of Dumei, Zhejiang.
Sharp tools make good work. After accepting the entrustment, Chinese enterprise Dongfang quickly set up a project team composed of professionals such as M&A, law, finance and public relations, and assisted Dumei in a thorough plastic surgery, including: optimizing the shareholding structure, standardizing financial management, changing business strategy and adjusting asset layout. Its purpose is not only to make Zhejiang Dumei meet the requirements of laws and regulations for the acquisition and reorganization of listed companies, but also to complete its functional transformation, that is, from the original industrial management enterprise to the investment holding enterprise, so as to make better use of the capital market platform.
Under the guidance of China Enterprise East, the internal restructuring of Dumei in Zhejiang Province lasted for 4 months and achieved remarkable results: the main business assets have been merged into various subsidiaries; The head office was renamed as Zhejiang Dumei Holding Group Co., Ltd., which strengthened its strategic management and investment and financing functions; Signs of planning, R&D, investment, auditing and other functional departments are hung in front of each office; In order to be strictly separated from future listed companies, Dumei, Zhejiang Province has also made a series of business and personnel adjustments. Through many efforts, a new American university with clear ownership structure, distinct investment levels, complete assets and standardized operation has emerged, and all preparations for entering the capital market have been ready.
At the same time, the search for M&A targets is also in full swing. After several rounds of screening, argumentation and negotiation, Chinese enterprise Orient targeted Bao Hua Industry, a listed company in Shanghai.
1999 Bao Hua Industry, which was listed, has always been the coveted object of various "princes" in the capital market. However, Bao Hua Industrial's controlling shareholder, Beijing Tian Hong Group Corporation (hereinafter referred to as "Tian Hong Group"), is the leader of Beijing's real estate industry. It's hard to take over a listed company from it!
Baohua Industry has long been in the sight of China enterprises in the East, and the top management of the two companies have already made contact. After long-term observation and in-depth understanding, China Enterprise Orient has come to the conclusion that the advantages of Tian Hong Group's transfer of the controlling stake in Bao Hua Industry outweigh the disadvantages, which is just the right time. The reason is that Bao Hua Industry is only a small chessboard among the tens of billions of assets of Tian Hong Group, and its main business and location are far from the parent company, so it is difficult for the parent company and the subsidiary company to integrate. In other words, if Tian Hong Group wants to support Bao Hua industry, it can only inject real estate assets and resources into it, and once these real estate businesses grow up, it will form horizontal competition within the group and destroy the overall industrial layout of Tian Hong Group in the country.
In fact, since the listing of Bao Hua Industry, Tian Hong Group's "blood transfusion" support has never stopped, and in most cases it is carried out through huge related transactions. With the strengthening of domestic securities market supervision, the support of "robbing Peter to pay Paul" makes Tian Hong Group feel stretched and struggling. At the beginning of 200 1, another listed company under Tian Hong Group, Tian Hong Baoye, appeared. This newly listed company concentrates many advantageous resources in the group, and is located in Beijing with Tian Hong Group, all of which focus on real estate development, so it is difficult to integrate the management between the parent company and the subsidiary company. In contrast, restricted by Hainan's economic environment, the operating conditions of Bao Hua Industry did not improve, and even suffered the first loss at 200 1, thus losing the ability to refinance in the securities market. This means that Tian Hong Group's contribution to Baohua Industry over the years has not only failed to return, but needs to make greater efforts.
Thus, the value of Bao Hua's industry in the Tian Hong Group system has been greatly reduced, and it will not be worth the loss for Tian Hong Group to support two listed companies at the same time. It is a wise choice to adopt the strategy of eliminating the weak and preserving the strong.
From the perspective of Dumei, Zhejiang, Bao Hua's industry is an extremely rare good "shell": the capital stock is small, and the expansion ability of future asset capital is strong; The assets are simple, and the main assets, Hainan Baohua Seaview Hotel and Beijing Universiade Village Student Apartment, operate smoothly, and there are basically no bad assets; The debt ratio is low, and there is a lot of room for making full use of financial leverage for debt management in the future. These conditions are undoubtedly attractive to Dumei, Zhejiang. However, only an ideal M&A goal can not guarantee the success of M&A, and the more critical factor lies in having a scientific, reasonable and novel planning scheme.
After in-depth analysis of the strategic situation of both parties to the merger, China Enterprise Orient believes that Tian Hong Group and Zhejiang Dumei are both in the real estate industry, but they are geographically disparate and have different natures, and their advantages and disadvantages are just complementary. If Baohua Industry can be used as a cooperation platform, resources will be effectively allocated. Therefore, the restructuring plan of Baohua Industry should not be simply to leave the country and change homes, but to complement each other's advantages and strengthen the alliance.
Although Dumei in Zhejiang can't be compared with Tian Hong Group in terms of asset scale, the keen market vision of private enterprises and the smart market smell of hounds are what Tian Hong Group and other state-owned enterprises lack. On the other hand, Tian Hong Group's strong government background and brand financing advantages are beyond the reach of private enterprises such as Zhejiang Dumei. If the two can work together for the long-term development of Bao Hua's industry, it will create a model of organic integration of state-owned private economy, the echo of the North-South real estate industry, and a virtuous circle of industrial management and capital management.
Based on the above analysis and judgment, the representative of Chinese enterprise East, Zhejiang Dumei, proposed an acquisition proposal to Tian Hong Group: Zhejiang Dumei acquired the controlling stake of Baohua Industry, and Tian Hong Group retained its position as the second largest shareholder. The two sides took this opportunity to form a partnership and realize complementary advantages. Under the matchmaking and arrangement of China Oriental Enterprises, the top management of Tian Hong Group and Zhejiang Dumei met at Xizi Lake. What impressed the representatives of Tian Hong Group was not only the way and efficiency of private enterprises in Zhejiang, but also the rapid development of the real estate industry in the Yangtze River Delta (in sharp contrast with the economic environment in Hainan where Baohua Industry is located).
The negotiation of equity transfer has made rapid progress in a friendly atmosphere. If this is a goodwill merger, it is better to say that it is a new type of capital alliance.
Obviously, the restructuring plan put forward by Chinese enterprise owners shows the interests of both sides, which coincides with the general idea of the new leadership of Tian Hong Group.
After many negotiations, Tian Hong Group not only reached the intention of equity transfer with Dumei, Zhejiang Province, but also agreed to move the restructured listed company to Hangzhou. In September 2002, Tian Hong Group and Zhejiang Dumei formally signed an equity transfer agreement, and Zhejiang Dumei acquired 28.23% equity of Bao Hua Industry held by Tian Hong Group and became its largest shareholder. As a result, Zhejiang Dumei, with total assets of 300 million yuan and net assets of less than 654.38+0 billion yuan, holds Bao Hua Industry with total assets of 730 million yuan and net assets of 420 million yuan at one stroke, which can be described as "four to two". In addition, as Bao Hua Industry is the second largest shareholder of Tian Hongbaoye (stock code 600376), Zhejiang Dumei indirectly participated in another listed company. In this way, Zhejiang Dumei completed its first capital "jump". At the same time, Tian Hong Group retained 265,438+0.22% shares. As the second largest shareholder, Tian Hong Group can not only share the long-term benefits of future strategic investment, but also unload the burden of the "boss".
Since the end of 2002, Bao Hua Industry, which has changed its new "owner", has begun an orderly restructuring process: by cleaning up the related assets and creditor's rights and debts with Tian Hong Group, it has standardized the relationship of "cutting things and returning them to chaos" in the past; Due to jumping out of the original group interest framework, a number of projects that have been stagnant for many years, such as Hai Ruo and Trang Van, have been restarted; After revitalizing natural resources, the company shifted its business focus to the Yangtze River Delta. At the beginning of 2003, the investment of 65.438+0.8 billion yuan won the bid for the development projects of Chun 'an in Zhejiang and Qiandao Lake in Hangzhou.
Today, Bao Hua Industry has officially changed its name to Zhejiang Dumei Holding Co., Ltd., and its office has moved to Zhong Da Square, a high-end office building in downtown Hangzhou. In the past, Bao Hua Industry was only a "small fish in a big pond" in the Tian Hong Group system, but now it is owned by Dumei, Zhejiang Province, and has become the main force of the whole group. Naturally, it has gained brand-new development opportunities and shown unprecedented vitality.
Entering the capital market is a milestone in the growth history of Dumei, Zhejiang. In less than half a year after holding a listed company, with the strong support of the local government, Zhejiang Dumei has greatly improved its asset scale, social influence and investment and financing ability. It not only won the bid for real estate development projects many times, but also recently obtained a loan line of 6,543.8 million yuan from local banks. At present, the total assets of the whole group have increased by 200% compared with before buying the "shell", reaching the scale of nearly 900 million yuan, and Dumei, Zhejiang Province has also completed the second capital "jump". At this time, Wen Zhanghua, the "head" of Dumei, who became the chairman of the listed company, sat in the spacious office on the 28th floor of Hangzhou Zhong Da Plaza, looking out the window at the mushrooming buildings, and could not help feeling smug.
Zhejiang Dumei's growth trend line was drawn in advance by its financial adviser, China Enterprise East. Li Zuogao, assistant general manager of China Enterprise Oriental, who is in charge of "Zhejiang Dumei-Bao Hua Industry" project planning, believes that M&A itself is a high-risk enterprise behavior. If there is no entry of incremental resources and it is just a simple capital rearrangement, then M&A may become a "zero-sum game" with great possibility of failure.
Delong's philosophy is that both mergers and acquisitions and industrial integration need to introduce key incremental resources, so that enterprises after mergers and acquisitions can successfully break through the "bottleneck". In the merger case of "Zhejiang Dumei-Baohua Industry", this key incremental resource is the policy support of Zhejiang local government. In order to encourage the development of listed companies, the local government has given Zhejiang Dumei many preferential policies in land supply, credit and taxation, which is an important guarantee for its "amazing leap" in capital.
Li Zuogao bluntly said that the biggest trick for Delong to leverage120 billion assets with billions of assets is to find a new cooperation model-let's call it the top entrepreneur club in the capital market. The operation of Chinese enterprise Oriental can be said to have applied the successful model of Delong, and before that, Delong had already reflected this tendency in the process of integrating the cement industry in Xinjiang and transforming Tunhe shares from a cement king to the first tomato sauce producer in Asia.
If Delong was more embodied in "industrial integration" at that time, the "enterprise resource integration" of production enterprises had been realized when Dumet borrowed Bao Hua from China enterprises.
At present, there is a serious shortage of resources for listed companies in Zhejiang Province. Recognizing this, China Enterprise Oriental not only considered the replacement of capital (from Hainan to Zhejiang) and resources (the complementarity between private and state-owned economy), but also focused on the full utilization of social resources (with the help of policy support) in the planning scheme of Dumei, Zhejiang. This planning scheme does not copy the ready-made model of Delong M&A case, but it embodies the essence of Delong's idea to some extent.
Assets and capital are provided by all parties involved in the integration, and what Delong himself has done is only the role of trader and intermediary. Delong's rapid expansion in China's capital market in just a few years depends on his "integration ability". The purpose of establishing China Enterprise Oriental in Delong is to transform into CITIC Integrated Financial Holding Group through a series of investment bank operations, mergers and acquisitions, and integration, so as to gradually make this entrepreneur club truly take shape, so that Chinese enterprises and entrepreneurs are willing to merge into Delong's subsidiary and do things that they never dared to think about before.
Previously, many parties in the market who were rumored to be acquired or manipulated by Delong could deny the merger, or deny that the major shareholder was Delong, which was precisely caused by Delong's special model.
At the beginning of the establishment of China Enterprise East, it chose a very good take-off place-Zhejiang with rapid economic development. There is a vibrant private economy, a huge amount of private hot money, a local government that is close to the people and pragmatic, and a large number of high-quality enterprises eager to go public, sighing at the gate of the securities market. It can be said that Zhejiang is a treasure house of investment banks.
Delong's ambition is to send as many Zhejiang private enterprises as possible to the capital market through enterprises in eastern China, and then integrate these enterprises and resources at the capital level through Delong, an entrepreneur club.
According to statistics, so far, the number of private enterprises in Zhejiang has reached 1 17. Under the current "channel system", it will take several years to digest this figure. Moreover, the corporate governance structure of Zhejiang private enterprises is still flawed, and most enterprises are far from standardized joint-stock company operation, which seriously restricts the process of their direct listing.
In addition, the single property right structure, nonstandard accounting and tax payment in financial management, and lack of professional talents are all the weaknesses that hinder the direct listing of Zhejiang private enterprises.
In view of the present situation of the survival and development of private enterprises in Zhejiang, China Enterprise Oriental has tailored a complete capital operation plan for them, that is, while completing the standardized transformation, Delong's skilled M&A skills are used to achieve "backdoor listing", and then M&A expansion and horizontal integration are carried out by using the platform of listed companies, and finally the core business of enterprises is promoted to scale, grade and step. Gao Jiang, vice president of China Enterprise Orient, believes that many private enterprises in Zhejiang have reached the stage of breaking through the bottleneck and accumulating. To achieve this breakthrough, enterprises must complete the transformation of growth mode, that is, from internal accumulation in the past to merger, acquisition, integration and outward expansion, which is Delong's strength.
The core advantages of Zhejiang private enterprises are keen market vision, pragmatic management style and good cost control. If we add Delong's M&A growth model and capital market resources, it will be even more powerful and achieve the effect of leap-forward development. The merger case of "Zhejiang Dumei-Bao Hua Industry" completed in the second half of 2002 can be regarded as a small experiment of China enterprises in the East.