2003: Starting with Foreign Trade

Chapter 565 A Triumphant Return Home
Shen Nanpeng was interested, but Tan Jincheng was having a bit of a headache.

Acquiring a car company across borders is not just a matter of money; in fact, money is the least of the problems and the easiest to solve.

"It's fun to talk big for a moment, but I never expected him to actually take it seriously."

After hanging up the phone, Tan Jincheng smiled wryly at Gu Qingqing.

"What, you don't want to acquire Land Rover?"

"I've thought about it, but it's very difficult. The process of cross-border acquisitions is extremely complicated. I wasn't planning on making any acquisitions before, so I wasn't prepared at all."

Obtaining a license is quite simple. Tan Jincheng doesn't need to do much preparation. He just needs to pay a sum of money, sign a few contracts, and get some related technology. After returning home, he can promote it and make some noise. It's unlikely that anyone in the know would expose him.

Besides, even if it's exposed, it's not a big deal; at most, it's just inappropriate publicity.

In this day and age, acquiring a company across borders requires the approval of at least three government-level departments: the National Development and Reform Commission, the Ministry of Commerce, and the State Administration of Foreign Exchange. If it is a state-owned enterprise, the approval of the State-owned Assets Supervision and Administration Commission is also required.

Without the approval of these departments—commonly known in the industry as a "license"—no matter how much money you have, it's useless.

However, it is extremely difficult for a private enterprise to obtain the necessary permits. Geely is currently planning to acquire Volvo, and even a company of its size has not yet obtained the permits, not to mention having to guard against state-owned enterprises trying to steal the spoils.

Back when Geely acquired Rover, it was a case of a state-owned enterprise snatching the prize away.

Talking big might feel good in the moment, but it'll lead to disaster later.

"Then what should we do? Since President Shen has this idea, we can't just let it go like this." Gu Qingqing also had a headache.

In terms of business reputation, you can't just let it go with a joke. Since you had this idea before, and Shen Nanpeng is willing to cooperate, you have to take it seriously.

“Let’s do it then. We’ll prepare for both possibilities. After we return to China, we’ll set up an acquisition project team, and you can participate in it as well. As for the authorization of Serene, let’s discuss that together as well.”

They need to prepare for both possibilities. Whether the acquisition succeeds or not, it won't be a matter of a day or two. Weilai Auto doesn't have enough time. They must quickly obtain the authorization of a luxury brand and then make a name for themselves at several domestic auto shows.

Moreover, this time they are competing with the most powerful company in India, and it's still uncertain whether they can win the Land Rover deal.

To be on the safest and most efficient side, securing the authorization from Sering is the most secure option. However, since we're going to do it, we must go all out and make the acquisition as powerful as possible, which would also enhance our national prestige.

The following day, Tan Jincheng approached Shen Nanpeng to discuss how to acquire Land Rover, and also asked Shen Nanpeng to help him make some contacts with Sai Ling.

"After I get back, I'll set up an acquisition project team and inform Ford by sending them an email. I'll also figure out how to handle the official paperwork and fundraising together."

“Yes, if Flash is to gain control, they’ll have to deal with the cops. You have a lot on your plate,” Shen Nanpeng sighed.

This was a spur-of-the-moment plan, with neither side prepared. The Indian side had already started making offers, and although Ford had not yet agreed, unlike Volvo, Ford had publicly stated that it wanted to sell Land Rover Jaguar.

Volvo Ford wanted to keep it for a while. Tan Jincheng also knew that Geely's acquisition process would be difficult, but for an asset that it didn't want, Ford didn't really care who it sold to as long as the price was right.

Indians have no shortage of money.

"Yes, the acquisition is just the beginning. We still need to build factories in China, which requires a lot of money. And whether we can absorb it is a big question."

Flash Motors' acquisition of Changfeng Group was already a case of a snake swallowing an elephant, so acquiring Land Rover would be an even bigger snake swallowing an elephant to the power of N. Whether it can be digested, or whether it will overwhelm the company, is also a question.

"Yes, the acquisition seems the most difficult part, but what happens after the acquisition is even more difficult."

The most important thing for a car company is not actually funding, but whether it can start production on time. If a car factory cannot start production on time, having a lot of money is useless.

This is also why Tan Jincheng was so eager to acquire Yangzi Automobile. Once he had Yangzi Automobile, he could start production. With production, there would be hope, and he could also better negotiate with various regions.

"Alright, let's get Sai Ling sorted out quickly first. That old man is in a real bind and needs money urgently, so just give him a little extra to get rid of him."

Having made up his mind, Shen Nanpeng was very decisive, even revealing what he knew about Sai Ling's bottom line.

Sequoia's roots are in the United States. If they wanted to help a domestic company obtain a license, it would be too easy for them. With Sequoia's help, the negotiations went very smoothly.

Furthermore, Sequoia Capital is very familiar with American law and knows how to avoid legal risks. On May 9th, a Friday, Tan Jincheng and Saling Motors Co., Ltd. acquired the global brand license for three supercars—the Saling Camaro, Mustang, and Saling S7—for US$1 million.

The Seren S7 was named the world's most expensive car by Forbes magazine in 2005 and is known as the king of supercars. It sold very few units in China, but it was certainly a big draw.

In addition, Tan Jincheng also spent $500 million to buy some of Sering's technology and patents. For Sering, who is two years older than Tan Jincheng and is almost crying from lack of money, $600 million is not much, but it is a life-saving sum.

Of course, Tan Jincheng would have to spend more than 600 million US dollars. There were also many shady dealings on Lao Mi's side. The few million US dollars on the surface would not have been enough for Tan Jincheng to obtain Sai Ling's authorization so easily.

"I'm truly grateful for Mr. Shen's help this time. I'll be returning to China tomorrow, so let's keep in touch," Tan Jincheng said, raising his glass.

Tonight was a special banquet he hosted to thank Shen Nanpeng, a heartfelt expression of gratitude.

Shen Nanpeng nudged him: "Haha, no need to thank me. The Red Shirt side has also benefited. We're all just cooperating."

Previously, it could be said that it was Shen Nanpeng's personal favor, but when Tan Jincheng formally asked Hongshan to intervene and help, there must have been a price to pay. In fact, what followed was a trial cooperation between the two parties before the acquisition of Land Rover.

"No matter what, I have to do Mr. Shen a favor this time. Although Mr. Shen has more influence in China than I do, he can always come to me if he needs any help in the future and I can help him."

This can be considered a promise made by Tan Jincheng. From the initial investment in Orange Technology, Shen Nanpeng has provided Tan Jincheng with a lot of help. A good investor is truly a benefactor to an entrepreneur.

In a sense, Shen Nanpeng was also one of Tan Jincheng's benefactors.

With Orange Technology's IPO, aside from future investments in connected vehicles, Tan Jincheng has basically lost interest in the internet business. He believes that not all money needs to be earned, and sometimes it's necessary to make some trade-offs.

Without this collaboration, Shen Nanpeng would have gradually lost contact with Tan Jincheng, and their relationship would have ended once Hongshan withdrew from Orange Technology.

"Haha, I've really hit the jackpot this time, since I got a promise from President Tan." Shen Nanpeng also said with some emotion.

In Shen Nanpeng's impression, Tan Jincheng was young, but if you were fooled by his appearance and age, you would be very wrong. This kid was very slippery, you could say he was incredibly cunning.

Although he places great importance on contracts, it's quite difficult to have any interaction with him in private. He seems to maintain a friendly yet distant relationship with everyone, and everything he does is based on the company's interests.

For the sake of the company's interests, he could shamelessly hand out business cards in Tencent's office when he was weak, take a few people with him when visiting factories of competitors, and even humbly borrow money from him shortly after they met.

You often find it difficult to gain the friendship or commitment of such a person, but if you do, they will earnestly keep their word.

It's often said that investing is all about people, which is both true and false. However, when Tan Jincheng made this promise, Shen Nanpeng felt that Orange Technology's investment was the right one. It not only brought huge profits but also gave Sequoia Capital an opportunity to get involved in advanced domestic physical technology.

To raise funds to acquire Land Rover, besides seeking local government involvement as a partner, the only remaining options are bank loans and equity financing. Regardless of whether the Land Rover acquisition is successful, it will be relatively easy for Sequoia Capital to acquire shares in Hangxin Times and Weilai Automobile during this process.

"No, perhaps Mr. Shen won't need it."

"Haha, we'll see if we need it later; by the way, do you still want to pledge your Orange Technology shares?"

"Of course I'll pledge it, but let's talk about it when I get back. I need to organize my thoughts."

If he wants to acquire Land Rover, Tan Jincheng will have to do almost everything he owns, just like with Geely. Pledging only 6.5% of Orange Technology's shares is definitely not enough. At this point, Tan Jincheng wants to do some shady things again.

Fake accountants and those A-share listed companies like to repeatedly pledge their shares. Tan Jincheng really wanted to learn from them and see if he should take a gamble, but considering the impending subprime crisis, he hadn't made up his mind yet.

Increasing leverage can indeed raise more money, but in the context of the subprime mortgage crisis, if Orange Technology's stock price collapses, Tan Jincheng will face a huge financial crisis.

"Alright, then I wish President Tan a safe journey. President Tan has made a triumphant return home this time."

It has indeed been a very successful day. In the five trading days since its listing, Orange Technology's market value once surged to around 100 billion. The stock price has performed very well in the past five days. As of today's closing, Orange Technology closed at $15.13, with a market value of over 95 billion.

In addition, Tan Jincheng also obtained the global authorization for the Sering brand, which can be described as a glorious achievement.

"I have another favor to ask, Mr. Shen. When I return to China, please help me release the news that I have acquired the Serin brand. The wording may be a bit vague."

"Haha, I get it."

(End of this chapter)