2003: Starting with Foreign Trade

Chapter 958 Boss Tan is magnanimous!

Sunday, May 8.

At the entrance of the Sheraton Hotel in Nanshan District, which has only been open for four months, a steady stream of people are heading towards the registration area set up on one side of the lobby.

"Hey bro, where are you from?"

"I'm from Guangzhou, where are you from?"

"I'm from Shenzhen. How much have you invested?"

"25%, and you?"

“Well, I’m a little better off than you. I only got five points.”

"Damn, you're definitely going to make money, but I'm not so sure. I just don't know how much premium Mr. Tan will offer. I hope Mr. Tan will be as generous as ever and let me break even. I've had enough of this damn stock."

The extraordinary general meeting of National Technology attracted widespread attention due to the takeover bid by Tan Jincheng and ByteDance, and the number of attendees also broke all previous records.

Considering the large number of attendees, Sun Yingtong did not hold the shareholders' meeting in the company's conference room as usual, but instead chose the magnificent Sheraton Hotel.

The reason is quite simple: Tan Jincheng and his entourage are staying here, and Sun Yingtong has been coming here almost every day for the past few days.

"It's all because of President Tan. Our shareholders' meeting has never been so lively."

On one side of the registration area in the lobby, Sun Yingtong smiled helplessly. The retail investors really didn't mind making things worse. After the announcement that an extraordinary general meeting of shareholders would be held this Sunday, Guomin Technology received a steady stream of requests to attend. Some shareholders even came from northern cities, thousands of miles away.

"It's a good thing. More witnesses will spread the news faster, and it will be more lively."

Tan Jincheng looked relaxed. He had seen this scene many times before. Every shareholder meeting of Weilai Group was always packed with people. Compared with Weilai's shareholder meeting, Guomin Technology's was child's play.

There are no particularly strict requirements for attending shareholders' meetings of listed companies. Even if you only hold one share of the listed company, you can attend. This is one of the few opportunities to get in touch with senior executives or even celebrities of the listed company.

Many interesting things have happened at shareholders' meetings, both domestically and internationally. For example, there's an old man who participates in various shareholders' meetings just to get freebies. And then there are the shareholders' meetings of Warren Buffett's company, which are always the focus of attention.

Domestically, the shareholders' meetings of Moutai Group have always attracted widespread attention. In addition to its high profile, attending the Moutai shareholders' meeting also offers a special benefit, such as the opportunity to purchase Moutai Feitian series products at a more favorable price. In recent years, Moutai's Feitian series has almost become equivalent to financial products.

There are many such shareholder meetings of listed companies in China that have welfare benefits, such as preferential treatment for shareholders in terms of food and shopping. The shareholder meeting in Weilai is no exception.

By participating in the Weilai shareholders' meeting and becoming a shareholder of Weilai, one can enjoy exclusive car purchase discounts, which can be combined with existing discount packages. Many consumers who want to buy a car even go so far as to buy 100 shares of Weilai stock.

In addition, during the shareholders' meeting, Weilai will also arrange buses to pick up and drop off shareholders to visit the factory, so that shareholders can have a more intuitive understanding of the company's production and operation. It is a well-known shareholders' meeting in China.

There are quite a few shareholder meetings with welfare benefits, which have even spawned a group of "wool-gathering" groups. However, the shareholder meeting of National Technology was completely devoid of benefits. Those who attended this time were not only there to watch the excitement, but also to find out the specific details of the acquisition.

The stock price has been crashing for several years. Among the 7.62 shareholders, even major shareholders like Yu Bo are trapped. The small investors of Guomin Technology are suffering.

Of course, timing is also crucial. It's currently summer vacation, and many consumers will take advantage of the summer break to travel with their families. Professional stock investors are a group with high net worth, and they are people who are not short of money.

According to current listed company rules and the Company Law, a shareholder must hold more than 3% of the shares to make a proposal at the shareholders' meeting of a listed company. Before August 12, ByteDance's attempt to propose a tender offer at the shareholders' meeting was actually not in accordance with the procedures.

Even the extraordinary general meeting of shareholders did not have this right, but because of the size of ByteDance and Tan Jincheng's celebrity effect, no one cared about the process.

No one would question whether ByteDance's advertising platform has the capability to acquire a company with a market value of less than 40 billion yuan.

However, ByteDance's advertising platform has now completed this process. Previously, information was released to the public through Sun Yingtong. Under the current rules, only Sun Yingtong of Guomin Technology has this right. In fact, Sun Yingtong is exercising the rights of the actual controller with a 3% shareholding.

It's a formal shareholders' meeting now, and it would be quite inappropriate if the procedures weren't completed. This is one of the reasons why Cheng Linfeng has been actively acquiring shares from both large and small shareholders in the past few days.

Currently, among the top ten shareholders, besides Sun Yingtong, ByteDance has acquired six others, totaling 4.81% of the shares, bringing its total shareholding to 5.724%. National Technology has also officially released a related announcement.

ByteDance is not in a hurry to acquire Sun Yingtong's shares at this stage, because there are many things that require Sun Yingtong's cooperation afterward, and even after the acquisition is completed, there will be many handover matters that require Sun Yingtong's cooperation.

Sun Yingtong is not in a hurry to sell her shares. No matter how Tan Jincheng wants to change the existing management structure of Guominji, Sun Yingtong's position will remain stable for a long time. Both parties have a tacit understanding on this point.

Based on the due diligence conducted by the acquisition team, there are no issues with Sun Yingtong, who has worked at National Technology for over a decade and has made significant contributions to the company.

From his early days as the "King of IC Cards" to his transformation into a semiconductor company, Sun Yingtong has been a key figure in the development of mobile payment chips and automotive-grade chips, and a crucial figure in driving the company's transformation.

In terms of both business acumen and management experience, Sun Yingtong is well-suited to the current national technology sector.

To be honest, National Technology was also quite unlucky. In 2017, 5 million yuan of investment funds were embezzled, making it one of the victims of this mess. There are actually a lot of listed companies like this.

You're after other people's interest, but they're after your principal. In this era of rampant speculation, countless listed companies, including many well-known ones, have fallen victim to these scams.

The 500 million yuan loss, while it dealt a significant blow to National Technology, wasn't crippling. After all, its core business was still operating well, generating 100 to 200 million yuan in net profit annually, which would recover in a few years.

However, to make matters worse, the subsidiary acquired in the second year quickly went bankrupt. The 13.36 billion yuan acquisition deal collapsed, which stunned National Technology. The most crucial point was that it went bankrupt for two consecutive years, making it impossible to explain the situation.

The collapse of Snow Industries, in relation to National Technology, seems like a setup, but it's also their own fault.

Blindly acquiring non-core businesses for huge sums, entering unfamiliar industries, and failing to conduct thorough due diligence—13.36 billion yuan! That's almost 10 years of National Technology's net profit. Is it necessary to make such an acquisition without a need for a complete transformation?
Of course, whether there was any foul play involved or whether management was involved is anyone's guess.

However, Tan Jincheng didn't care about any of this. Once the company was in his hands, he would still have the final say. Whether he was involved or not, he didn't care.

"Hello everyone, I am Tan Jincheng. Welcome to the shareholders' meeting of National Technology. In this hot summer, I apologize for taking up your time. On behalf of National Technology and ByteDance, I would like to express my apologies."

At 10:00 a.m., the shareholders' meeting of National Technology officially began. After Sun Yingtong's opening remarks, Tan Jincheng appeared in the center of the stage.

Liu Yiqian, who no longer holds any shares, was sitting below, watching Tan Jincheng in the center of the stage.

His attire was consistent with his usual public appearances: a basic short-sleeved shirt and jeans, making him look very young, like a college student; of course, for Liu Yiqian, this billionaire was indeed excessively young.

"I've heard that Mr. Tan always dresses very carefully when he appears in public. Is that true?"

Cheng Linfeng, who was standing next to Liu Yiqian, asked with some curiosity.

"Haha, it's not that particular, but what he's wearing is indeed our own brand. Mr. Tan's short-sleeved shirt is GXG, and his jeans are also from a brand under Jinpeng Industrial. Our boss did mention that."

"In his words, 'Don't let the good stuff go to outsiders.' Every public appearance is an opportunity to sell products."

Liu Yiqian chuckled, "President Tan's business dealings are truly beyond words. What about the watch?"

Besides his attire, Liu Yiqian also noticed that Tan Jincheng was holding Meizu's latest flagship phone, and his watch was still the iconic Longines model, which wasn't expensive, and even a bit cheap for Tan Jincheng's status.

"Oh, the watch? It was a gift from our boss's wife. She's been wearing it for over ten years. We'll only replace it if the company comes up with a new product."

Smartwatches have become quite popular in recent years, and Meizu produces quite a few electronic products, such as headphones, tablets, and other peripherals. However, there are no plans to develop a smartwatch at the moment.

Tan Jincheng's speech on stage continued.

"As the controlling shareholder of Weilai Group, ByteDance Engine has an acquisition need for Guomin Technology based on its own needs. Therefore, we have issued an acquisition request to the management of Guomin Technology. We are very grateful for the cooperation of the management, including Mr. Sun."

"By the way, you should all have seen the new announcement, right? We are now the largest shareholder of National Technology."

After saying that, Tan Jincheng shrugged and said with a hint of joking, "To be honest, becoming the largest shareholder with more than 5% of the shares is a first in my investment career. I hope this first time will bring a perfect experience to me and all the shareholders."

The crowd burst into laughter; they were all seasoned stock market investors, and they all knew exactly what the shareholding ratio meant.

"Okay, everyone stop laughing. It was just a joke, there was no malice intended."

Tan Jincheng gestured for everyone to stop: "I know that no matter how many ideals we talk about or how nice the words we say, no one really cares. What everyone cares about most is definitely the agreed acquisition price, right?"

The acquisition is a privatization, and National Technology is planning to delist after the acquisition. No matter how ambitious their ideals are, it's irrelevant to them now. "That's right, Mr. Tan, just tell us the price. If the price is right, we'll sell the shares to you on the spot."

"That's right, I'm also a shareholder of Weilai Shares now, so President Tan should give me a better acquisition price."

"Of course! In fact, I'm from the same hometown as you, Mr. Tan. I came all the way from Luzhou."

Tan Jincheng has always maintained a friendly public image, and his humorous attitude at the event also impressed the shareholders. Those who were able to travel a long distance to attend the shareholders' meeting were basically people who were not short of money.

Seeing Tan Jincheng's attitude, the atmosphere at the scene became more lively, which made the users who were deeply trapped feel much better.

"I understand everyone's feelings, and I also thank that friend for supporting Wei Lai; investing in stocks is all about making money. I was also very frustrated when my stocks were trapped back then, but I think everyone should know that investing involves risks."

"In this acquisition process, ByteDance's advertising platform certainly cannot meet everyone's needs, but based on the fact that it is an investment company with a good reputation in the A-share market, we will try our best to satisfy more shareholders."

"We hope everyone can understand this."

Tan Jincheng's words calmed things down considerably.

Yes, ByteDance has a good reputation and its profits are quite considerable, but they are a professional investment company, not a money-making machine.

Some investors likely bought their shares between 2015 and 2016. After the high stock dividend, their highest cost was probably between 15 and 20 yuan. If these investors missed the hype, it will be very difficult for them to break even.

It's impossible for ByteDance to offer such a high price.

"I won't waste any more words. Regarding the agreed price, based on the average price over 20 trading days, ByteDance's pricing engine gave an agreed price of 9.15 yuan, corresponding to a market value of 51.06 billion yuan for Guomin Technology, and a premium of 30%."

"The premium corresponding to the current share price is 44.32%!"

"Everyone can check their phones. From the K-line chart, you should be able to see that most investors who bought the stock after January 2018 can break even at this price, and most of them have made a profit."

"The static and dynamic premiums of 30% and 44.32% may not be the highest in the world, but they are definitely not low."

"There aren't many reference cases in the A-share market, but you are all knowledgeable investors, so you should know that in US stock tender offers, the average premium is between 15% and 20%, while the average premium in Hong Kong stocks is 29%."

"We have offered a premium higher than the average for US and Hong Kong stocks, which allows most investors to profit. We hope this price will satisfy everyone."

Tan Jincheng used the most intuitive figures to address the questions that everyone cares about most regarding the prices.

"Holy crap, 9.15 yuan! Boss Tan is so generous! Haha, I not only broke even but also made a profit. I'm selling now!"

The guy who was chatting at the registration desk earlier said he was down 25%. He was a bit stunned when he heard the price of 9.15 yuan. His cost was 8.24 yuan and he held 10,000 shares.

I lost nearly 20,000 yuan of my 80,000 yuan investment, which made me extremely depressed. Now, not only have I broken even, I've also made over 9000 yuan, pulling me out of the abyss of being trapped in a losing position.

"Holy crap, this price is really reasonable. I just did the math, and at this price, I've made a 35% profit; damn, I've never had such a high return in the stock market."

"Boss Tan is mocking us; what's the next line after 'knowing astronomy and geography'? It seems the online claim that Boss Tan is a 5G surfer is true, he even understands this meme."

"Let them mock me all they want. I bought 5 shares last month and lost 10%. Boss Tan made me 10 in one go. I'm so grateful to him."

"Ugh, I'm still losing money on this price, it's really frustrating."

While some are satisfied, others are naturally disappointed, especially some investors who like to trade within a range after being trapped, leading to increasingly higher costs. They admit that the price of 9.15 yuan is really reasonable, and no investment institution would offer such a reasonable price.

But a loss is a loss, and as everyone knows, after National Technology was acquired by ByteDance, it was to be privatized and delisted, which means there is no possibility of them recovering their losses.

However, as Mr. Tan said, investment does involve risks.

"The takeover bid for ByteDance's privatization will lead to the delisting of National Technology after the acquisition. Delisting means there will be no chance of recovering the investment. I know that many shareholders will suffer significant losses because of this acquisition, and I regret this."

"However, the price cannot be changed. The final price we can offer is 9.15 yuan, but we will provide some compensation in other ways."

Tan Jincheng's words immediately silenced everyone.

"As everyone just mentioned, many friends came from out of town to attend this shareholders' meeting, like my fellow townsman. For those friends from out of town, whether you make a profit or a loss, you can go to the registration desk in the hotel lobby and find the staff of ByteDance to reimburse your travel expenses."

"Oh, by the way, this time the travel expenses will be reimbursed by ByteDance."

"In addition, for those who are still losing money on the 9.15 yuan agreement price, our compensation plan for those who are willing to sell is that you can go to the offline stores of Weilai, Meizu, Flash, and GXG with the agreement to receive a small gift."

"As for what the small gifts are, you can probably tell from the brand names that they are basically merchandise from these brands. Although they may not be enough to make up for your losses, they are a token of our appreciation."

"By the way, this only applies to users who are still losing money on 9.15 yuan. Please don't think we're stingy. After all, Guomin Technology has 7.62 shareholders. If we were to compensate everyone, I couldn't afford it."

In order to complete the takeover bid as quickly as possible, the team went to great lengths. The price of 9.15 yuan can guarantee that more than 80%, or even more than 90%, of the shareholders can break even and make a profit, and sell with peace of mind.

The remaining 10-20% of shareholders are facing a real headache if they don't sell. It's impossible to offer compensation in the secondary market or ask for a higher price, so they have to find other solutions.

"What kind of gifts are they, Mr. Tan? Could you tell me?"

This made the shareholders, who were still losing money, feel much better, and they were also curious about what gifts ByteDance's advertising platform would give them.

The shareholders who had recovered their losses and made money were also curious, but they did not express their dissatisfaction. In their view, they had already made money from Boss Tan, so it would be unreasonable to accept gifts again, especially since he had reimbursed their travel expenses.

This is already an unexpected surprise.

"As for the gift, you all know Meizu phones, right? Taking Meizu phones as an example, the small gift we are providing this time is a Meizu Blue phone priced under 1200 yuan. It's not a high-end model, but you can use it as a backup phone."

"Other brands also offer small gifts based on this price standard. For example, with Weilai Auto, you can choose a peripheral product of corresponding value. The same applies to Shanchi Electric Vehicles, or you can choose a shopping voucher with no minimum purchase requirement."

"As for GXG, 1200 yuan should be enough to buy several pieces of clothing for you and your families. We hope our actions can bring you some comfort."

Sell ​​your stocks and get a Meizu phone for free!
Everyone, including Liu Yiqian, was stunned by Tan Jincheng's actions; this was something that had never happened before.

"Wow, Mr. Tan is really good at this."

Liu Yiqian stared at Cheng Linfeng with a look of surprise and doubt. The National Technology management team, including Sun Yingtong, all had the same expression. They didn't know about this plan at all, and the ByteDance acquisition team had never revealed it before.

The management of National Technology was unaware of the reimbursement for this travel expense beforehand, let alone the shareholders present at the scene.

"Hehe, I told you there would be a surprise at the shareholders' meeting."

Cheng Linfeng looked smug. "You know, our boss is a marketing genius. Based on the calculation of up to 20% of users who were trapped outside the 9.15 yuan price range, ByteDance has allocated 20 million yuan for compensation this time."

This is the highest budget; the actual cost will definitely be much less, but the effect of this 2000 million yuan is quite different.

Besides offering some psychological comfort to users who have suffered losses, this is also a huge marketing opportunity for ByteDance's advertising platform. With this marketing success, if ByteDance wants to make a splash in the market in the future, the effect will be very different.

At the same time, the boss also fully considered the psychological feelings of the users. If they had just given out shopping coupons or something, people would have felt that it was too greedy. A discount of 1200 yuan to buy a Weilai car? That's just pure nonsense.

Sending gifts directly is different from choosing to combine them with no-minimum-spend shopping vouchers; this puts the choice in the hands of the user.

The 2000 million yuan investment not only promoted ByteDance's advertising platform itself, but also connected all of its products. In particular, the description of GXG at the end was full of warmth.

"Haha, bringing home a Meizu phone might not be a big surprise, but bringing home a bag of clothes is definitely a different story."

Based on GXG's average selling price, 1200 yuan could buy at least four or five pieces of clothing.

The shareholders' meeting is still ongoing, but the hashtag "#BossTan'sGenerosity" has already become a trending topic on Weibo.

(End of this chapter)