2003: Starting with Foreign Trade

Chapter 568 The Time to Pick Up Bargains Has Begun!

"Haha, now I understand what it means when all the good news is out, it's bad news."

"That's right, the market manipulators are so obvious these days."

Even Cheng Linfeng was deeply impressed, realizing that I had made my financial dealings with Changfeng Group far too obvious.

The announcement on the evening of the 27th led to a significant gap up of 6.75% at the open on the morning of the 28th, creating the impression that a major surge was imminent. However, after the opening, the stock quickly plummeted from a gain of nearly 7% to -5%, with a fluctuation of over 10% that left retail investors who were tricked into buying in during the pre-market session feeling extremely distressed.

On the 28th, Changfeng Group opened nearly 7% higher but closed at the daily limit down, with the stock price closing at 10.46 yuan.

"I lost 17% on a day I bought in the opening auction, and I got yelled at for it, haha."

"It's impossible to succeed in the secondary market without getting criticized. In fact, if Flash Technology didn't have the profits to go public, there would be no need for it to go public. It's a pity."

Cheng Linfeng had seen FlashTech's financial report. The company was extremely profitable, with high gross profit, short payment terms, and ample cash flow. It was incredibly lucrative.

If the boss doesn't have such big ambitions and just sticks to the electric vehicles and clothing businesses, he will have a large amount of cash in hand after a few years.

If I make some more investments, life couldn't be more comfortable.

“Boss, you bought 5% of the shares in Xiangcheng City Investment, which makes things much easier for me. It looks like Changfeng Group’s stock price is about to collapse, so I’m not in a hurry to buy any more.”

Cheng Linfeng genuinely sensed something strange about the recent rapid rise in stock price. It seemed as if some major funds were using this opportunity to drive up the price and escape. In addition, due to the rise in stock price, some retail investors who had previously promised to buy shares were no longer going back on their word.

Liu Shaoxin's acquisition has recently been progressing very poorly.

“Let’s do it your way. It’s not us who’s in a hurry now, it’s them. Even if they want to sell, we might not be willing to take it. If the major players run away, the stock price definitely won’t be able to hold up. Let’s just wait and see.”

To some extent, the rapid rise in Changfeng Group's stock price is also related to the 5% stake that Tan Jincheng acquired directly through a transfer.

Circles are circles; they share information. The news that FlashChi acquired Changfeng Group's shares on the secondary market was spread among some small circles. Those who held Changfeng Group shares were all thinking of cooperating to sell it at a high price.

However, their plans fell through when Flashway announced that it had acquired 5% of Changfeng Group's shares through a negotiated transfer.

In the last two trading days of May, Changfeng Group fell another 5%.

Entering June, Changfeng Group's stock price collapsed even faster. In just six trading days, the stock price fell to 8 yuan, directly breaking through Tan Jincheng's acquisition price of 9 yuan.

By June 19, Changfeng Group had hit another daily limit down, with its stock price closing at 6.44 yuan. Its market value had plummeted from nearly 5 billion yuan at its peak in May to 25 billion yuan, a drop so rapid that it was unimaginable.

"The A-share market has crashed, so start building positions. Buy Changfeng Group when it's below 4.99%, and buy other stocks like Shuguang Auto as you see fit."

The market also plummeted today, with the Shanghai Composite Index falling below 2800 points. Many stocks hit their daily limit down, especially in the auto sector. Shuguang Auto also hit its daily limit down, closing at 6.29 yuan, with a market capitalization of less than 14 billion yuan.

With only 12 days left until the new National III emission standard officially takes effect on July 1, coupled with the impact of unforeseen events, the automotive industry is under tremendous pressure.

Tan Jincheng knew that the stock index would fall by about 1000 to 1200 points, but considering the trading volume, now was the most appropriate time to buy the dip.

"Let all the operators of ByteDance Engine be in place from now on and get into a formal working state. Also, it would be best if Xiao Liu were interested in moving the company into a building, so that everyone can cooperate a bit more."

Liu Shaofeng's company is now dominated by ByteDance, and there are still some empty floors in the Flashpoint Building, so it's possible to provide them with a few offices.

“The trading volume is there. I don’t require you to buy a certain number of shares every day, but you must buy them at the lowest possible price. You can use this as a standard for KPI assessment.”

Where can you find a car company with 25 billion and 14 billion?
Even companies like JAC Motors have only a market value of 50 billion yuan left, and the market value of Shanghai Automotive Industry Corporation, the largest automobile company in China, has also fallen to 572 billion yuan.

These are companies that would later become worth tens or even hundreds of billions of dollars. Buying them during the 2008 stock market crash would have been pure profit.

It looks like a stock market crash now, but if you look at the bigger picture, it's just pure free money.

Cheng Linfeng was also very happy. The securities department of ByteDance had been on break for half a year. Some employees who couldn't stand the loneliness had jumped ship. It was a cycle of bull and bear markets.

After two rounds of attrition, the remaining employees are all those who can withstand the test and endure loneliness.

How much money is left in the company's account?

The 4.55 million yuan acquisition certainly couldn't be funded with their own capital; otherwise, what's the point? Based on Changfeng Group's current share price, buying another 4.99% of the shares would cost approximately 1.2 million yuan, 6000 million yuan less than last month. In less than a month, ByteDance's acquisition has already lost a third of its value, becoming a laughing stock in the secondary market. While retail investors are losing money, they are also jokingly saying that Boss Tan has gone home to become a money-giving boy.

The cash acquisition of 4.55 million yuan has been officially transferred to Changfeng Group's account. Of this, 2 million yuan was obtained through bank loans, and 2 million yuan was provided by Beilun City Investment through its investment in Weilai Automobile.

The remaining 5500 million yuan was from our own funds.

"There is still 4.5 million yuan left. The majority of it will be used to acquire shares in Changfeng Group. The rest will be used to acquire a controlling stake in Xiao Liu's private equity firm and for company expenses. It's not a large amount."

Tan Jincheng nodded: "Okay, we'll plan based on this 4.5 million yuan. As for the rest, I'll sign a cooperation agreement with the company for my trust fund. Mr. Gu will then take a position at ByteDance to oversee that fund. Please help me take care of it."

Gu Qingqing hasn't been to the company much lately, staying at school to prepare for her graduation defense and this year's graduation ceremony at Ningbo University. However, she has already decided that she will continue her postgraduate studies at Ningbo University.

If they secretly acquire 4.99% of the shares on the secondary market, combined with their current holdings, ByteDance will hold 9.99% of Changfeng Group's shares, which is only 25% away from absolute control.

25%, that's about 6 million. To complete a full acquisition, it would cost around 11.75 billion? That's still a bit expensive.

Let's wait until the stock price drops for another month before talking about it. At least we'll lose at least a hundred million.

Let's see what happens after July. If Changfeng Group fails to reverse its fortunes in the civilian vehicle market after the new national standards are implemented, then negotiations will be much easier.

"How much money is in Mr. Tan's trust fund? This will help me make a more comprehensive plan."

Huang Ming was in charge of negotiations, while Cheng Linfeng was in charge of the secondary market and cost control. Therefore, he needed to make a specific plan for the funds.

"Haha, there's quite a lot of money in the trust fund."

Speaking of this, Tan Jincheng was laughing his head off. At the end of last month, when Chinese concept stocks in the US surged for a few days and Orange Technology's market value stabilized above 100 billion, Gu Qingqing, along with the 3.5% stake she had secretly planned to reduce, really sold it at a very good price.

After selling all 3.5% of the shares, Tan Jincheng received 3.22 million yuan in cash. In addition, the pledge of the 6.5% stake held by Tan Jincheng was also completed, and Tan Jincheng received 5 million yuan in cash from the pledge.

After considering it for many days, Tan Jincheng decided not to repeatedly pledge his shares. On the one hand, it could easily cause turmoil in the company, and on the other hand, he was afraid that if Wall Street targeted him and shorted the stock relentlessly, Orange Technology would really be lost.

"With 8 million yuan of cash injected into the trust fund, plus what's in the company's books, there's no problem acquiring Changfeng Group."

In fact, the company already has enough in its accounts, with more than 4 million yuan in cash. Leveraging two to three times is very easy for Cheng Linfeng, who has experience as a fund manager.

Putting aside everything else, the 5% stake held by ByteDance Engine can now be pledged at a securities firm, easily raising 50 to 60 million yuan.

Cheng Linfeng also planned to do this, using these shares as collateral to secure the funds for acquiring Changfeng Group in the secondary market.

"12 billion in cash. To be honest, I've never fought such a wealthy acquisition battle before."

Cheng Linfeng has no other thoughts on his mind except that his boss is too rich. If it is just a simple backdoor listing, buying an ST shell company, the boss can complete the task with the cash he has.

Does this even need to go public? That's just too outrageous.

"Alright, you should make your financial plans. I'm going to Yangzi Automobile with Mr. Zhang in a few days. The new production line is going into operation, and as the boss, I have to show up."

It was pure luck that the new production line was upgraded to meet the National III emission standard, allowing the newly produced pickup trucks to be sold directly on the market. As for the older models, Tan Jincheng has no plans to upgrade them.

If you can't get a license plate, you can't get a license plate. Try to find connections to use it yourself or donate it in exchange for some benefits.

The commissioning of Yangzi Automobile has injected considerable vitality into Weilai Automobile. A factory is always the key to an automobile company; only when the factory is running continuously can it be considered a normal automobile company.

As for those brands that don't even have factories and are just OEM products, they are not trustworthy at all; they can run away with the goods at any time.

As of May, more than 70 new and facelifted models have been launched, covering all market segments and competing models, averaging one new car per day, the highest density in recent years. However, the performance has been disappointing.

In the fiercely competitive market, a new player has emerged in the second half of the year. Unable to sell civilian vehicles, he's starting to sell pickup trucks, taking the route of a mini-Great Wall Motors.

The second half of 2008 is coming, and the stock market crash in A-shares will intensify, while the subprime mortgage crisis worldwide is getting closer and closer, with crises lurking everywhere.

However, the era of great development for Tan Jincheng and his Flash Group was quietly beginning, starting with this financial crisis.

(End of this chapter)