2003: Starting with Foreign Trade

Chapter 640 Beside the Bed
The advantage of having a makeshift team is that once the boss makes the decision, everything will be fine.

This is why, when some companies have financing needs, the person who has the final say is the most decisive; success is success, and failure is failure.

“Your husband talked for several minutes, while my husband said OK in 30 seconds.”

This is a classic scene.

The two shareholders have basically finalized the details. All that's left is for Tan Jincheng to persuade the other shareholder. Persuading him is easy, since the investment is unlikely to be a loss.

For the Beicang government, Tan Jincheng can bring a brand new project to the local government, one that can be started immediately and, if things go smoothly, can be officially launched to the market by the end of this year.

"Alright, let's leave it at that for now. I'll head back to the hotel and contact Beicang while I'm at it."

Seeing that the matter was settled, Tan Jincheng did not linger any longer. He needed to get things settled with Beicang as soon as possible. In addition, he had to finish a project plan tonight. It would be somewhat informal to use a project for financing without a project plan.

Although Tan Jincheng seems frivolous when discussing cooperation, constantly rambling on, he always submits a formal project plan before signing the contract, so there's nothing wrong with the process.

I collaborate a lot with government departments, but I don't have a formal project plan. Who knows, I might get myself into trouble someday.

Back at the hotel, Tan Jin immediately called Leader Gu and Xie Hongjun. Beicang District was already fed up with Tan Jincheng's constant antics.

They're making a takeover bid for a listed company here, and then they say they want to acquire a controlling stake in Zhongtai Beicang and get involved in low-speed electric vehicles.

Leader Gu laughed and said, "You're not right if you don't make a fuss, are you? Let's wait until the project proposal comes over."

And you know what? With such a vibrant entrepreneur in the district, things are really bustling. According to incomplete statistics, the hotels around Flashgate have seen a significant increase in business in recent years, mostly driven by people coming to Flashgate on business trips, and the rest by media reporters.

When the media reporters came here, they weren't just interviewing Tan Jincheng.

"I will submit the project proposal later and send it to Mr. Xie. I have already had a preliminary discussion with Mr. Ying, and he has agreed to my plan."

To Gu's surprise, Ying Jianren had actually agreed. He had thought that Tan Jincheng wanted the district to cooperate with him in taking control of the Beicang factory.

Are you in Yongkang?

"Yes, I'm at the Yongkang Hotel, I just finished talking with President Ying."

"You little rascal, I only heard this morning that you caused quite a stir at the Shanghai Auto Show, and tonight you're off to Yongkang causing trouble. Fine, fine, you've already made arrangements with the relevant operators, the district will definitely support you."

"Also, next time you go out, take two more people with you. You're worth billions now, you can't entrust your safety to others."

Um, did the organizers in Shanghai file a complaint?

However, Leader Gu's tone had a hint of instructing the younger generation.

"Okay, okay, I'll definitely be more careful next time and won't cause any trouble for the place."

Tan Jincheng's behavior sometimes puzzled Lao Gu. Don't young people like to make a show of things? Wherever he goes, except for formal negotiations where he brings a lot of staff, he brings as few people as possible when he goes out.

When I come to the district to handle business, I sometimes drive myself. I'm much more low-key than many middle-aged entrepreneurs.

But when it comes to doing things, he's incredibly high-profile. This time, his bid for Shuguang Auto really excited the district's working group responsible for promoting its listing. They thought he was about to have a third listed company.

The working group responsible for pushing the IPO has not yet been able to contact him, and we don't know the specifics of the situation.

After listening to Tan Jincheng's explanation, Xie Hongjun readily agreed. He had done in-depth research on Flash Technology and was one of the investors who had been in contact with Tan Jincheng the longest. He had always known that Tan Jincheng's ultimate goal was to make lithium batteries and work in the new energy field.

"You started this 'old people's car' project to add more business to Jinshidai's battery business, right?"

"With this in mind, if Jinshidai wants to achieve technological breakthroughs, it must apply and test the technology on different products; otherwise, it cannot make progress. In addition, it can also alleviate some of the financial pressure."

Last year, Hangxin New Energy's overall loss was 3.13 million yuan, which was much less than the loss of more than 7 million yuan in 2007. This is not because its business performed particularly well in 2008 that the loss was reduced.

The real reason is not that Hangxin New Energy's own finances have improved, but that its investment has decreased.

In 2008, Flash Group's focus was on backdoor listing and automobiles. To avoid further financial deterioration, investment in power batteries would definitely be secondary.

Furthermore, the company's finances improved, offsetting some of its financial losses.

In terms of the proportion of losses, 2008 was no less than 2007.

Lithium batteries are also used in electric vehicles for the elderly. If they sell well, they can alleviate some of the financial pressure on Hangxin New Energy and also be used for testing. Why not?
"Yes, but I want to control the company. President Ying has agreed to transfer 39% of the shares. President Xie, could you transfer 6% of the shares to me?"

Tan Jincheng is just as direct with Xie Hongjun, making no attempt to hide his control over the company's controlling stake.

Xie Hongjun on the other end of the phone wasn't surprised. He was used to Tan Jincheng's style. This big boss was very particular about controlling the company; he insisted on having control of any project he initiated. "No problem, 6% it is. You can have more if you want."

Beicang City Investment currently holds 41% of the shares of Zhongtai Beicang. Even if they transfer 5% of their shares, they will still hold 35% of the shares, which is still a large number of shares. If Ying Jianren wants to take more, Beicang City Investment can transfer more shares.

For investment institutions, controlling stakes are irrelevant; making money is the most important thing.

"What is your opinion on the company's valuation, Mr. Xie? I will provide the full set of technology and some cash in exchange for control of the company."

According to the agreement reached with Ying Jianren, the overall valuation is 3.5 million yuan. A 6% stake would be worth 2100 million yuan. In addition, with the 39% equity stake in Zhongtai, the total cost would be 1.575 million yuan.

After the change, Zhongtai Beicang will become a minority shareholder, while Xinchi Intelligent will become the largest shareholder, holding 55% of the shares.

"The overall valuation is 3.5 million yuan. After the change, I will reduce the registered capital further."

Xie Hongjun was silent for a moment. Investment can't always be a win-win situation. To be honest, the initial valuation of 4 million yuan seems too high now, considering the development of Zhongtai over the past two years.

From the district's perspective, there was no loss; from the city investment company's perspective, there was a loss. However, it wasn't a big problem. The 2000 million yuan loss was exchanged for a car factory, so overall, it was still a profit.

As for the low-speed electric vehicle project that Tan Jincheng mentioned, he needs to review the project plan before deciding how much equity to transfer.

If the prospects are good, then only 6% will be transferred; if the prospects are average, then more will be transferred to recover as much capital as possible.

"Okay, the valuation is fine. Send me the project proposal as soon as possible, or I can go to Yongkang and we can discuss it in person?"

"That would be best; some things are better discussed face-to-face."

"Okay, I'll go then. I'll be there before noon tomorrow."

Xie Hongjun was also decisive. He was currently involved in real estate and didn't need to leave the market much, so he took a trip to Yongkang to relax.

It would be great if Xie Hongjun came over, but the project proposal still needs to be written, so I'm destined to work overtime again tonight.

Having secured the approval of the district and the two major shareholders, Tan Jincheng was able to relax for a while.

After calming himself down, Tan Jincheng dialed Gu Qingqing's number: "Go register another company, and name it Yongcheng Leichi New Energy Co., Ltd."

"What's wrong? Why are you paying attention to the new company again?"

"Do you remember the project I told you about with Sailing, which I called 'Old Man's Joy'? I'm planning to take over the Zhongtai Beicang factory to produce that stuff."

Gu Qingqing chuckled on the other end of the phone: "Ha, so you've finally made your move on Zhongtai. I thought you were going to wait a few years."

"How do you say this?"

"You and I know each other perfectly well. Look at the equity structure of Beicang Company. You've been eyeing it ever since you handed over the car production license, haven't you?"

"Haha, you're absolutely right. This is a great opportunity, and it was proposed by President Ying himself. We definitely can't miss it."

"How can I allow someone else to sleep peacefully next to my bed? If Flash Motors wants to get into the car business, how can the small Beicang area possibly accommodate a second car company? We must take it over."

The greater Ningbo city area might be able to accommodate a few car companies competing for resources, but the entire Beicang District is definitely not an option. If resources are allocated to Weilai, Zhongtai will inevitably have fewer resources, and they will have no choice but to leave.

Actually, this was almost destined from the moment Wei registered.

"Why not just use ByteDance's advertising platform to hold the controlling stake? Why register a new company?"

"An extra layer of protection means one less risk."

The holding company of ByteDance's advertising platform is Cheng Yue, an offshore shell company with a registered capital of only 100 million yuan. By using Cheng Yue to control ByteDance, the company reduces its own risks through a multi-layered holding structure.

There's no other way. If the equity structure isn't designed well, given the scale of Tan Jincheng's business today, the risks are simply too great. A problem with one subsidiary could cause problems for the entire group.

"Okay, I understand. I'll arrange for someone to take care of it tomorrow. When will you be back?"

"If it goes as fast as Monday, it will be fine; if it goes as slow, it will take a few days. By the way, could you keep an eye on ByteDance's advertising platform and Dawn Auto's announcements?"

"understood."

Gu Qingqing's postgraduate studies are really tough. She attends classes and handles her work on weekends, making her life incredibly fulfilling. Fortunately, she can go home every day and have some fun with her sister-in-law.

(End of this chapter)