2003: Starting with Foreign Trade

Chapter 294 A sudden turn of events
The atmosphere at the welcome dinner that evening wasn't particularly lively.

With her own thoughts on her mind, Wang Qinghua wasn't in the mood to urge him to drink. Besides, there was a long-standing rumor in the electric vehicle industry that this Mr. Tan couldn't hold his liquor, so Wang Qinghua really didn't dare to push him to drink too much.

On the very first day, he revealed his intention to acquire a controlling stake in Bafang Electric. He really knows how to be efficient and doesn't want to waste any time.

But if you hand over controlling stake, can you still consider it your own company?
In other words, Wang Qinghua had already planned to cooperate. Otherwise, someone who wasn't prepared would probably have flipped the table immediately upon hearing that he was going to hand over the controlling stake in the company, even if Tan Jincheng expressed it tactfully through storytelling.

After dinner, Wang Qinghua, in the spirit of being a host, wanted to arrange a second event, but Tan Jincheng refused.

Tan Jincheng didn't mean anything by it; he just wasn't interested. These kinds of venues no longer held any appeal for him. However, Wang Qinghua interpreted this as having another layer of meaning.

"Does this mean we should just give up if we can't reach an agreement?" Wang Qinghua asked, frowning.

From today's conversation, Wang Qinghua could tell that FlashTech had no plans to build a factory, but rather preferred to acquire it directly. If they couldn't reach an agreement with Bafang Electric, FlashTech could choose to negotiate with other suppliers.

Technology can be developed, but time waits for no one.

Having technology doesn't mean everything. The market won't give you a long time to adapt, nor will it give you a long time to adapt. If Bafang Electric's products are always used by small manufacturers, it will be impossible to achieve a breakthrough.

What should we do?

Wang Qinghua, who couldn't sleep all night because of worry, met with Tan Jincheng again the next day with dark circles under his eyes; there was no way around it, there were a lot of motor companies like Bafang Electric that had been established for a few years, not to mention the whole of Jiangsu Province, even in the Suzhou Industrial Zone.

For Tan Jincheng to buy such a company would be incredibly easy; it would simply require spending some more time adapting it to the electric vehicles under the Flash Motors brand.

Bafang Electric did not hold a significant advantage during the negotiations.

This wasn't Wang Qinghua's first time starting a business. In the past, she would only ask for help when her business was failing. Although it was frustrating, it was also full of hope.

Now, Wang Qinghua felt the helplessness of the weak; in the face of absolute power, you have no power to fight back.

We must become strong!
"What's wrong, Mr. Wang? Didn't you sleep well last night?" Tan Jincheng also noticed Wang Qinghua's dark circles.

"After what Mr. Tan told yesterday, it's a miracle I could sleep well," Wang Qinghua said resentfully, looking at Tan Jincheng.

Tan Jincheng laughed and said, "It's still important to rest well. If the sky falls, someone taller will hold it up. Getting a good night's sleep is very important for your health. But Mr. Wang, you misunderstood. I didn't tell that story because I wanted your company."

"What do you mean?" Wang Qinghua asked, puzzled.

He admitted that he had completely lost his footing in the negotiations, and if he wanted to regain his strength, he would have to have the courage to tell Tan Jincheng that they did not need his orders and that the company would absolutely not sell!
However, this is something that Bafang Electric cannot do. The strategic significance of FlashTech to Bafang Electric is not simply that of a major customer.

This is Bafang Electric's ticket to enter the high-end electric vehicle market.

“I didn’t mean to take over Bafang Electric. Although my friend reduced his shareholding to 49%, he still manages the company. Flash will not interfere with the company’s operations, and he also holds a certain number of shares in the parent company.”

"Holding more than 51% of the shares is only for future strategic needs. In addition, if Mr. Wang is not at ease, I can also sign a concerted action agreement with you. The company will still be your company, and we will just be strategic investors."

This tactic was learned from Pony Ma: invest in related companies, become strategic joint venture partners, and then let the original team run the business. QQ can provide certain resources when necessary.

FlashTech can also do this with its suppliers, providing certain funds and collaborating on technology research and development. With FlashTech's order guarantee, Bafang Electric can also develop other customers without any interference in Bafang Electric's operations.

QQ provides traffic support to its strategic partners to help them develop, while FlashTech can also use orders to support its invested companies. The models are similar, and there won't be a situation like when all the companies invested in by Lao Matou went bankrupt.

The main reason why Tan Jincheng of Bafang Electric wanted so many shares was that he knew the company would go public in the future, and he wanted to acquire more shares to make more money later.

Otherwise, like Mingcheng Industrial or its agents, they could simply take a small share.

Tan Jincheng wasn't sure which year the company went public, but it had at least been listed before he entered the market. He remembered it because the company's stock was doing very well at the time, reaching a high of around 300 yuan. Taking advantage of the fact that the company hadn't yet developed, he wanted to acquire as many shares as possible. As for a full acquisition, Tan Jincheng hadn't considered it. Under his control, Bafang Electric might not necessarily go public; at most, he would treat it as a supplier for electric vehicle business.

"Just invest, but don't interfere with operations?" Wang Qinghua's expression softened somewhat.

"Of course, the company is still your company, and you remain one of the major shareholders with 49% of the shares. You have absolute power over the company. Apart from sending one director to oversee the financial situation, FlashTech will not make any business-related decisions. This is how we have always treated our partners."

Tan Jincheng is unwilling to do something as ridiculous as Old Ma acquiring a company, sending a working group to move in, kicking out the founder, and then the company going bankrupt. Can you manage to run everything yourself?
Of course, the different nature of Old Ma's and Little Ma's companies also determines the different investment styles of the two companies. Old Ma needs other acquired targets to provide him with traffic, that is, to leech off him, while Little Ma can rely on QQ and WeChat to provide him with funding.

Wang Qinghua hesitated. She had originally planned to sell some of her shares, but after Tan Jincheng's strong attack yesterday and a night of torment, the situation had eased somewhat today.

Although they still refuse to renounce their shareholding, after signing the agreement to act in concert, the company will still be their own company, only they will receive a smaller share of the profits from future development.

But that's all after development. Without Flash Technology as a high-end entry ticket, Bafang Electric will have to find a new entry ticket again. It's uncertain when it will be able to develop. Besides, won't other major customers be like Flash Technology?

This is an art of conversation. After realizing that the other party had guessed his intentions, Tan Jincheng immediately and forcefully stated that he wanted 51% of the shares, but did not mention any other additional conditions, giving people the feeling that he was very difficult to talk to.

It's like someone who has been doing bad things their whole life, but one day they suddenly do something good, and the outside world will think that the person has become good. Conversely, if you always do good things, then you can't do bad things.

"Apart from the change in shareholding, everything about Bafang Electric remains the same. There is no need to move to Beicang. You can still stay in the company. In addition, Flash Technology will do its best to supply Bafang Electric with orders, as long as you can handle it."

Even a single screw can have multiple suppliers. Whoever gets the most orders will earn more and grow faster.

"Overall, Mr. Wang, apart from receiving a smaller share of the profits during the company's development, you won't suffer too many losses. Of course, if Mr. Wang is willing to give up equity and a win-win situation, then disregard what I said."

If we calculate based on a 30% equity transfer, it really means less money. If Tan Jincheng really wanted his company, there was no need for such trouble. He could have simply acquired a small manufacturer or one of the existing suppliers, and then poached people from Bafang Electric. There wouldn't have been any problem.

Wang Qinghua was aware of this as well, and having said all that, she was already somewhat tempted.

However, he still wanted to fight for more.

"I wonder if I would have the honor of owning a certain share in Flashpoint Technology, just like your friend?"

Cross-shareholding is also a form of cooperation, which is equivalent to binding the two parties together. This is more reliable than any agreement on concerted action, since such agreements can be voided at any time.

Tan Jincheng readily agreed, "If it's Flash Technology, that's fine, but I can't give Mr. Wang too many shares, because Beicang City Investment only holds 5% of Flash Technology's shares, so I can only give Mr. Wang a maximum of 5% of the shares."

This was a pre-established plan: to acquire a well-run company, and to obtain a controlling stake in it. A monetary price alone would not suffice.

Unless you want to force a takeover and kick out the entire founding team.

In fact, in Tan Jincheng's contingency plan, even sacrificing a small amount of the parent company's shares would be acceptable. However, Tan Jincheng would definitely not bring this up himself; it was a bargaining chip that the other party had to propose.

Now that the other party is proposing to use Flashpoint Technology's equity to achieve cross-shareholding, that would be even better, as it would not require giving up shares of the parent company.

“Sure, 5% is enough to be considered a major shareholder, I have no objection,” Wang Qinghua said with a smile, the first time he had smiled so happily all day.

"Let's settle on this for now. Actually, I've always had a win-win attitude towards partners. Let me just say one thing: FlashTech has plans to go public within the next three to five years. Mr. Wang will know that I'm not stingy."

Wang Qinghua's eyes lit up: "Oh, President Tan has quite the ambition. But if FlashTech develops smoothly, it can indeed go public within three to five years."

In 2006, the term "listed company" was a prestigious one in every city, and local governments took pride in having as many listed companies as they could.

Unbeknownst to Tan Jincheng, his unintentional promise of a bright future planted a seed in Wang Qinghua's heart.

(End of this chapter)