A century-old wealthy family that rose from Shanghai

News of HSBC's acquisition of SITC Bank followed shortly thereafter.

Although the news caused a sensation, many people did not notice the Chinese capital behind SITC Bank, and simply assumed that HSBC and SITC Bank's board of directors had reached an agreement.

But how could such news be kept from Jardine Matheson and some senior executives? Everyone immediately understood—HSBC's defection was all about profit.

Suddenly, everyone began to feel sorry for Jardine Matheson.

If the Chan family in Hong Kong could even subdue HSBC, then Jardine Matheson was indeed in grave danger.

It’s Spring Again (1978).

“Father, at today’s board meeting of Wharf Holdings, Newbikin asked each director to introduce their recent major schedules, saying that the board meeting should be scheduled accordingly.” Chen Wenming came to Chen Guangliang’s office to tell him this news.

Although Chen Guangliang has not made a public appearance, he is still paying attention to these matters.

Of course, by this time, everyone knew that Chen Guangliang had stepped down from management of the four group companies, handing over the reins to his four sons. As for himself, he had become a recluse, and an employee told reporters that Sir Chen hadn't been to the company for a long time.

"What did you say, and what were your arrangements?"

Chen Wenming said, "Because I have to attend the Paris International Tanker Conference and fly to Mexico to meet with President Paul Diller, I simply reported my ten-day itinerary. However, I think Newbikin is probably planning something and intends to travel as normal. But if Jardine Matheson suddenly launches a takeover bid, I'm worried I'll have to trouble you to come out of retirement again."

"No need! I don't need to come out of retirement again. You can participate in the activities as usual, but your second uncle and I will be in Hong Kong. Wenbo can handle things then."

"it is good"

The Chen family is not a disorganized group, but rather a very united one.

A week later.

As expected, Jardine Matheson suddenly announced the acquisition, and major Hong Kong newspapers published huge advertisements for Jardine Matheson and Hongkong Land. The Jardine Matheson Group will exchange two new shares of Hongkong Land and bonds worth HK$65 with an interest rate of 10%, for a total market value of HK$80, in exchange for one share of Wharf Holdings.

The takeover battle raged for the first time, shaking the entire city of Hong Kong.

The stock market is in an uproar. This means that a share of Wharf Holdings has surged to HK$80, nearly double its market price of over HK$40 at the beginning of the year, and HK$25 higher than the current price of HK$55.

Only an old fool would keep nine shares; instantly, the nine shares flowed like a small river towards Jardine Matheson.

It was Friday, and Jardine Matheson's plan was quite shrewd. By giving the minority shareholders one day, if Global Group wanted to launch a counter-takeover, they might not be able to raise the funds by the weekend.

Of course, these are just minor points and a sign of insufficient strength.

The Global Group building.

Chen Guangliang and Chen Guangcong sat together, while Chen Wenbo stood and reported on the situation outside.

"At Jardine House, there are indeed retail investors selling their shares, but judging from the numbers, it's unlikely that there will be much to gain today."

Chen Guangliang nodded and said, "As long as we release the anti-takeover statement by the weekend, everything will be fine. But the question now is whether we should retain Wharf Holdings' listed status."

Upon hearing this, Chen Guangcong and his son Chen Wenbo were startled.

Wharf Holdings has issued a total of 1 million shares. Jardine Matheson is now offering HK$80 per share, which means they need a total valuation of at least HK$85 billion to privatize the company.

Even after deducting their 30% stake, they would still need 6 billion in cash. Meanwhile, the Global Group only had 60 million US dollars in cash flow, equivalent to 33 billion Hong Kong dollars.

Chen Guangcong quickly said, "Brother, even if we privatize, we'll find an opportunity to do so later. Think about it, Wharf Holdings' share price at the beginning of last year was only HK$14 per share, which is equivalent to a five-fold increase now. We would be losing money if we privatized it."

Chen Wenbo also said, "Uncle, Hong Kong's securities law doesn't stipulate that a majority stake exceeding 49% must be fully acquired, which is a legal loophole. We don't need to spend huge sums on privatization now, especially since our ships haven't even started being sold yet. I'm afraid Wenming has never even considered privatization."

Upon hearing the father and son's remarks, Chen Guangliang said with great pleasure, "You two are right! In that case, let's immediately invite Huoduoli and Ping An Investment to be our advisors and prepare to launch an anti-takeover campaign! This time, we will crush the Jardine Matheson Group in one fell swoop and give them no chance."

"Ok"

In reality, it's impossible for Chan Kwong-leung to privatize Wharf Holdings now, given that the Wharf Group's market capitalization of HK$8-9 billion is unlikely to be reached by 1981.

Even if privatization were to be carried out, it would be done in 1983-1984.

evening.

Jardine House meeting room.

Newbigen asked anxiously, "How did it go? How many shares did we acquire today?"

Charlie, head of acquisition advisor Jardine Fleming, said, "Only 2%. Including our existing holdings, we only have 18% of the shares. However, if Global Group doesn't issue a counter-takeover order this weekend, then next Monday, those retail investors will definitely flock to the market, and the outcome will be decided very quickly."

Newbijian nodded; he thought so too, as there were still retail investors observing the market today.

However, if Global Group does not respond after the weekend, retail investors will likely become anxious and will certainly sell their shares on Monday.

The conference room of the Global Group.

The head of Huoduoli, Langdes, and Chen Wensheng of Ping An Investment, have both arrived.

The reason for inviting HSBC's subsidiary, Wintek Financial, as one of the financial advisors is to avoid some legal risks. After all, Ping An Investment is a business of the Chen family, and it would be easy to be criticized if someone from the family were the sole financial advisor.

"This anti-takeover attempt must be a decisive blow, leaving Jardine Matheson no chance to retaliate," Chen Guangliang stated directly at the start of the meeting.

"So, what price should we offer?"

Chen Guangliang turned his gaze to Landes.

Lenders immediately said, "The Jardine Matheson Group's offer of HK$80 per share is always in the form of a combination of stocks and bonds, which is their usual tactic. But the shareholders of Dairy Farm who exchanged their shares for Hongkong Land shares back then actually suffered huge losses, which is still fresh in everyone's memory. So now we are offering a cash acquisition, and even if it is the same HK$80 per share in cash, we are very confident that we will succeed."

“I have a high degree of confidence, but I don’t have absolute confidence! I don’t want to drag things out for too long, as things could change if I delay, and it would give Jardine Matheson the strength to fight back. What I want is a quick victory, so that Hongkong Land has no chance to counter the takeover.”

Landes nodded and said, "Setting the price at HK$82-88 per share will give us an absolute chance!" Chen Guangliang said, "I like 88! Let's set it at HK$88 per share."

2000 million shares, at HK$88 per share, totaling HK$17.6 billion.

Because it erupted earlier than in the previous life, there are now only over 300 million Hong Kong dollars left.

Moreover, in Chen Guangliang's view, the money in the stock market was also their family's ATM. Spending it lavishly now would ensure they could get it back with peace of mind later.

4 p.m. on Sunday.

Having just returned from London, Chen Wenming attended the press conference of the Global Group without even washing up.

At the reception, Chan Man-ming announced that, on behalf of the Chan family, he would use approximately HK$18 billion in cash to acquire just over 2000 million shares of Wharf Holdings at HK$88 per share, increasing his stake to 49%. The acquisition period was limited to Monday and Tuesday. Furthermore, following the takeover of Wharf Holdings, Universal Group will release its overall business plan for the company.

Upon hearing this, the reporters at the scene were all very excited, wishing they had their own Wharf Holdings shares so they could make a fortune.

Of course, the Chinese journalists present were also greatly encouraged.

Jardine House meeting room.

Upon hearing the contents of the press conference, Newbikin knew that the situation was hopeless.

"The Chen family is ambitious and powerful. We can no longer fight them. The only way is to find the most advantageous solution. We must immediately sell our shares to the Global Group in batches, as many as we can."

Bedford nodded and said, "Okay, I'll arrange it right away!"

Newbikin's arrangement is the wisest choice. Now, if Hongkong Land sells its stake, it can actually make a substantial profit. If it continues to hold an 18% stake, it will certainly not gain any advantage.

The reason for this phased approach is that Global Group has stated it will not purchase shares of Wharf Holdings held by Hongkong Land and Jardine Matheson, leaving the opportunity to public investors.

Therefore, selling in batches can avoid such trouble.

On Monday, trading was suspended from the stock market since last Friday, and transactions could only be conducted through the stockbrokerage firm authorized by the World Group.

Minority shareholders of Wharf Holdings flocked to the headquarters of Wharf Holdings in Hutchison House and Ping An Investment in Ping An Bank Building, creating a bustling scene with long queues, indicating that the Chan family had secured victory.

The shrewd Jardine Matheson tycoon, Newbikin, knew that the situation was hopeless. He sold more than 900 million shares to Wharf Holdings, getting back nearly HK$8 million in cash and making a considerable profit.

In just over two hours, Universal Group had acquired 2000 million shares, spending a total of HK$18 billion in cash on stock purchases and commissions. With this, the Chen family's controlling stake increased to 49%, giving them a dominant position.

The minority shareholders who hadn't sold their shares in Wharf Holdings were furious.

In just one month, the Chan family acquired Hutchison Whampoa and Wharf Holdings, giving Hong Kong citizens a huge shock.

"Now that Sir Chan has retired, the Chan family's four tigers have truly become tigers. The eldest has taken over Hutchison Whampoa, and the second has taken over Wharf Holdings."

"That's right! After all, he's a second-generation member of the Chen family who studied abroad, and he does things with the style of Wall Street acquisitions."

"The eldest brother, Chen Wenjie, made a very smart acquisition this time, spending only HK$1 million to take over Hutchison Whampoa, a major trading company. In contrast, the second brother, Chen Wenjin, spent a full HK$18 billion this time, and with the previous stakes, it is probably no less than HK$25 billion."

"It's said that Hongkong Land sold over 8 million worth of Wharf Holdings shares. Looks like Hongkong Land isn't a loser after all!"

In the early 70s, Hong Kong shipping entered the era of containerization. After the Kwai Chung Container Terminal was built and put into use, the original functions of Wharf declined.

Faced with the profound changes in the Kowloon Peninsula, Wharf Holdings realized that it was a waste to use the prime location of Tsim Sha Tsui as a warehouse. Inspired by the success of early real estate development, it then devised a large-scale redevelopment plan.

At the time, Wharf Holdings felt that although the Central business district was prosperous and full of shopping malls, it became a deserted area after get off work in the evening. This situation only improved in recent years after the emergence of larger shopping malls. Therefore, Wharf Holdings envisioned building a small city-state that included residences, shopping malls, office buildings, hotels and recreational centers.

This is the Harbour City that stands today on the Tsim Sha Tsui waterfront.

The Harbour City site is adjacent to Wharf Holdings' earlier Ocean Terminal, Hong Kong Hotel, and Ocean Centre, covering a vast area of ​​430,000 square feet. The plan includes five luxury residential towers, three high-end office towers, two luxury hotels, a massive three-story shopping mall, and comprehensive recreational facilities. Due to Hong Kong Airport Ordinance regulations, building heights on this site cannot exceed 61 meters, resulting in a slight asymmetry between the site area and building heights. To address this aesthetic issue, Wharf Holdings divided Harbour City's design into three distinct groups of buildings: a fan-shaped tower along the waterfront and a rectangular building near Canton Road. All buildings are 17 stories high and situated on a large three-story platform. While each tower is independent, they are interconnected.

The Harbour City project, with a total development cost exceeding HK$2 billion, was constructed in five phases over more than 10 years. Built on the site of the former waterfront wharf and warehouses, it is hailed as "Asia's largest and most successful integrated commercial center." The three high-end office towers, named from south to north as the World Shipping Centre, World Business Centre, and World Financial Centre, offer approximately 800,000 square feet of leasable space. The five luxury residential towers, named from south to north as Ban Tao Court, Kwai Chi Court, Sau Tong Court, Pin Lan Court, and Xian Tao Court, provide a total of 375 residential units. With an elegant and sophisticated design, the towers are fan-shaped and overlook the harbor, offering unobstructed views of Victoria Harbour.

The two luxury hotels, Marco Polo Hotel and Prince Hotel, have over 800 rooms and are both managed by the renowned Peninsula Group. The three-story platform spanning the 11 towers is a massive shopping mall with approximately 350,000 square feet of leasable space, housing over 600 boutiques, about 50 restaurants, and a 669-space parking garage, making it virtually a self-contained world.

The Harbour City project was conceived in the early 70s and was expected to be largely completed by the early 80s.

Since then, Wharf Holdings has transformed into a renowned land king in the Tsim Sha Tsui area, with a large number of magnificent high-end commercial and residential buildings and hotels standing on the Tsim Sha Tsui waterfront, giving the area a brand-new look.

And now.

The acquisition of Wharf Holdings by Universal Group is truly inspiring.

Chen Wenming and Chen Wenbo took over Wharf Holdings and quickly made a series of new personnel appointments and announced some major strategies.

Four directors from the Global Group, including Chen Wenming and Chen Wenbo, joined Wharf Holdings. Chen Wenming personally serves as Chairman of the Board and General Manager, while Chen Wenbo serves as Executive Director.
At the same time, Chan Man-ming pointed out Wharf Holdings' "unreasonable arrangement" - the Hong Kong Tramways depot located on Sharp Street East in Causeway Bay was included in the development plan as early as the 70s, but the plan at that time was only to develop a small residential building, which was carried out by Hong Kong Tramways and Federal Properties under Wheelock Properties.

Chen Wenming immediately discovered that the factory site was located in a highly promising area of ​​Causeway Bay and asked the company to reconsider and repurpose it for other development purposes.

After reporting his work to his father, Chen Wenming awaited his father's approval.

Although everyone now knows that he is the actual person in charge of the Global Group, he still understands that without his father, they still cannot do many things perfectly.

After reviewing the blueprints for Harbour City and the map of the Hong Kong Tramway Depot, Chen Guangliang said, “The most urgent task is to complete the construction of Harbour City; all other plans should be postponed. Furthermore, Wharf Holdings is not suited to investing in ‘real estate development’ in Hong Kong, given that it already has Cheung Kong Holdings. Therefore, Wharf Holdings only needs to focus on developing two commercial projects—the first is Harbour City, and the second is the tramway depot site in Causeway Bay. The former will be completed as planned in the early 80s. If the airport is moved to Lantau Island in the future, and the height restrictions on air traffic control structures in this area are lifted, part of Harbour City can be converted into skyscrapers—but that’s a matter for the future. The Causeway Bay site can be used to build a shopping mall, creating the most bustling commercial area in Causeway Bay. I think it should be called Times Square. The entire project includes two 46-story and 36-story office towers, as well as a 16-story integrated shopping mall, accommodating 300 shops, 18 restaurants, 4 cinemas, and 700 parking spaces, with a total building area of ​​240 million square feet.”

Chen Wenming nodded and said, "However, Wharf Holdings has very limited funds. If we don't engage in 'real estate development,' it will be even more difficult to raise funds."

Chen Guangliang said, "No rush! The most urgent task is to complete Harbour City. Later, we will have the opportunity to privatize it and rely on the strength of the Universal Group to complete it. In addition, Wharf Holdings can still develop some of its own residential land and sell it as off-plan. The key is that the Harbour City and Times Square projects are only for rent and not for sale."

"Ok"

Today, the Global Group owns a vast portfolio including aviation, commercial real estate, container terminals, shipping, and trade—its scale is simply enormous. Therefore, Chen Guangliang naturally wouldn't allow Wharf Holdings to purchase residential land for development, as it would give the impression of excessive family monopoly. (End of Chapter)