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Evergrande was also in crisis before the IPO and won the trust of Uncle Tong Liu and Xu Jiayin for “concentrating on playing cards”

2021-10-21T02:10:38.718Z

China Evergrande (3333) has been involved in various industries in recent years, such as new energy vehicles, tourism, sports, finance, health and pensions, etc., in order to transform into a comprehensive enterprise, but in the debt crisis, Evergrande will eventually



China Evergrande (3333) has been involved in various industries in recent years, such as new energy vehicles, tourism, sports, finance, health and elderly care, etc., in order to transform into a comprehensive enterprise, but in the debt crisis, Evergrande will eventually start " "Demolition and reorganization", but "out of the gate", the plan to sell 50.1% of the Evergrande property for 20 billion yuan was announced to fail, and the stock price hit a wall after the resumption of trading!


In the end, whether Evergrande can survive this difficult situation remains to be "decided" by the mainland authorities.

Looking back at the history of Evergrande’s fortune, the group has also experienced two capital shortage crises, and each time it has survived with the "extensive and exquisite" skills of founder and chairman Xu Jiayin.


Xu Jiayin was born in poverty. The book "Xu Jiayin: Suffering is My Precious Wealth" described him as a hardworking and studious man. He was a "fighting Saburo" as the director of the factory and workshop and led more than 300 employees. After working for many years, he resigned resolutely and went south. Seeking development opportunities, starting from an ordinary salesman, he successively assisted the boss of Zhongda Company to develop steel and domestic real estate business. In just two and a half years, he earned 200 million yuan.

In March 1997, Xu Jiayin left Pengda and established Guangzhou Evergrande Industrial Co., Ltd.

His entrepreneurial career can be regarded as smooth. In two years or so, Evergrande Real Estate has emerged from more than 2,000 real estate companies in Guangzhou and became one of the top 10 real estate companies in Guangzhou.

The rapid development also made Xu Jiayin ambitious. In 2007, he decided to reorganize the real estate business and list it in Hong Kong.

Xu Jiayin, the richest man, was inspired by Deng Xiaoping to work south and has helped the company earn 200 million yuan!

Selling products fell through!

Evergrande: The transaction that could trigger a comprehensive offer for Evergrande properties has not been carried out

In 2007, Xu Jiayin decided to reorganize the real estate business and listed in Hong Kong, once becoming the richest man in China.

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The failure of the first IPO resulted in a funding gap of more than RMB 10 billion

In the same year, he introduced a number of institutional investors, including Deutsche Bank, Bank of America Merrill Lynch, Credit Suisse and Temasek, etc., to raise approximately US$1 billion in funds to expand land reserves through preferred stocks, mortgage loans, etc.; in March 2008, Evergrande The real estate has a land reserve of 45.78 million square meters. According to the records in the book, the market valued it as high as 120 billion to 130 billion yuan, which means that once it is successfully listed, Xu Jiayin will be worth 80 billion yuan.

However, in 2008, the financial tsunami broke out, the global financial crisis was "killed", the listing plan was in vain, and Evergrande’s funding problems also appeared. It is conceivable that Evergrande is in a situation. But I have a bottom line about the situation in my heart, and I have not yet reached the point of selling land and construction sites."

There are two main reasons why he is so "confident". According to the description of "Real Estate Madman Xu Jiayin", Evergrande still has many projects in its hands. Through the strategic promotion of "special price must be opened, special price must be appreciated", Evergrande suspended its listing. About a week later, the "Yujing Peninsula" located in Jinshazhou, Guangzhou was promoted at a 30% discount. Throughout 2008, Evergrande implemented a strategy of drastically reducing prices, and a large amount of funds were returned.

"Hoe Dee Club" becomes a white samurai of Xu Jiayin

Xu Jiayin also intends to solve the problem through listing. The book revealed that Evergrande still needed "life-saving money" at the time. Xu Jiayin was quoted as saying, "Three months after Evergrande suspended its IPO, my main energy was in Hong Kong, and I could almost say that I was working there. I lost four or five catties."

He believed that he was staying in Hong Kong to find the assistance of a group of "Da Ma Sha" in Hong Kong.

When Xu Jiayin sells properties in the mainland, he often invites celebrities under Emperor Entertainment to endorse him. Therefore, he met Emperor Yang Shoucheng, Chairman of the Board of Directors of Emperor Emperor, and through his introduction, he became more aware of Zheng Yutong, the founder of New World (0017).

It is reported that Xu Jiayin participates in Uncle Tong's "Hoe Dee" game from time to time.

There is a saying on the Internet that Yang Shoucheng told Zeng Xu Jiayin to concentrate on playing cards. "The card game sees his character." He can't talk about his business. For three months, Xu Jiayin went to 12 Repulse Bay Road to report almost every week. Without hindrance, the two became friends, and "Dee Club" became Xu Jiayin's "white warrior".

Evergrande was also in crisis before the IPO, and eventually Hong Kong was able to get through with the victory of the Hong Kong University.

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"Starlight Glimmer" on the day of listing

According to the report at the time, "Uncle Tong" supported Evergrande to restart its IPO; "Uncle Tong" invested US$150 million through Chow Tai Fook, accounting for 3.9% of the company's shares at the time; Liu Luanxiong, then chairman of Chinese Real Estate, also subscribed for US$50 million in shares. The entry has restored confidence in the market. Together with other institutions, Xu Jiayin has raised more than US$500 million in funds. Together with Zheng Yutong's investment of nearly RMB 800 million in two projects under Evergrande, the debt crisis has eased.

Evergrande’s international placement was oversubscribed by approximately 11 times, and the public offering was oversubscribed by approximately 46 times. The frozen capital exceeded HK$26.484 billion, and it was finally priced at 3.5 yuan.

The listing ceremony was even more "star-studded". New World "Uncle Tong" and his sons Zheng Jiachun, "Da Liu" Liu Luanxiong, and the chairman of Zhongyu Land, Zhang Songqiao, etc. were all present. It is rare to gather many members of the "Dee Club" Public event.

Evergrande backdoor "return to A" failed

After passing through this barrier, taking advantage of the development of the mainland real estate market, Evergrande is developing rapidly. Xu Jiayin also hopes to "copy" the battle of listing in Hong Kong and raise a large amount of funds in a short time.

In September 2016, Shenzhen and Shenzhen Real Estate, which is listed on the mainland, announced a reorganization. It plans to purchase 100% equity of Evergrande Real Estate by issuing A shares or paying cash. If the acquisition is completed, Evergrande can "backdoor" to list in A shares.

In order to meet compliance requirements, Evergrande has successively introduced strategic investments of approximately 130 billion yuan, and has also promised not to reduce shares, pledge financing, and pay cash dividends every year within 5 years.

However, the authorities have never approved, and Shenzhen and Shenzhen Housing was suspended for 4 years and 2 months, and 1,514 days later, the two parties announced the termination of the reorganization.

After Evergrande’s "Return A" failed, 130 billion RMB strategic investors, of which 86.3 billion strategic investors signed a supplementary agreement with Evergrande, agreed not to require repurchase, and continued to hold the equity of Evergrande.

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The "three red lines" constitute the saddest level

"Back to A" failed. Although most investors did not "leave the market" and continue to hold equity, the market believes that the termination of the reorganization will not affect the capital chain.

However, Evergrande has emphasized business diversification in recent years and has been involved in eight major industries, including real estate, new energy vehicles, property management, networking, RV treasure, Evergrande Kids World, Evergrande Health and Evergrande Bingquan.

Diversification is a good thing for the company. The business is no longer limited to the "Mainland real estate" item, but it has developed rapidly in a short period of time. When the Mainland has increased its efforts to implement the "Housing and housing non-speculation" policy, the "three red lines" have further closed. Tight financing and how to reduce debt has become the primary task of most domestic real estate companies, including Evergrande.

Evergrande’s successive measures include signing an agreement with Zhantou to convert into common shares, splitting properties and listing of new energy vehicles, and placing new shares. At the same time, it speeds up property sales and seeks to increase a large amount of cash flow in a short period of time, but the measures seem to be unsuccessful. It works. Recently, there have been many reports of failure to pay debt interest, and even "replacement of debt with buildings." Some investors even went to the headquarters to "protect rights."

As for this time, a lot of big sandals have also lost their hands because of their investment in Evergrande. For example, Liu Shan's investment in Evergrande’s shares may lose more than 10 billion yuan. It seems difficult to hope that the "hoe Dee will" will save again.

The next concern in the market, maybe who will be Xu Jiayin's white warrior, is it a state-owned enterprise, or is Evergrande the bankruptcy?

Detailed report:

China Land reduced its holdings of 109 million Evergrande shares within the year, or sold 751 million shares to pay the bill, fearing loss of 10.8 billion

Source: hk1

All news articles on 2021-10-21

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