Volume 8 Final Chapter Chapter 1239 Leverage Game (Part 2)
Wang Jiansen once said publicly: "I define my success as bringing Small Goal to a world super enterprise, or entering the top ten of the world's top 500 companies. This is my dream! To build Small Goal into a truly internationally renowned brand."
In 2013, Xiaomubiao went overseas and purchased land in Vauxhall, south London, England, Madrid, Spain, Gold Coast, Australia, Chicago, USA, and also acquired real estate projects in Los Angeles, USA.
2013 to 2016 was the peak period for real estate companies to go overseas. Encouraged by the policies at the time, domestic real estate companies began to expand into overseas markets, and Small Target was just one of them.
This wave gradually receded last year. As the country's overseas investment policies tightened, heavily indebted companies were forced to sell assets and withdraw. Those that rushed out to recreate domestic myths paid a heavy price for not adapting to the local environment. There are also cases of successful landing and continued gold-digging. They have grown another pair of wings in regions outside of China.
This is the tone of Nan Yi in publicly published articles, and the choice of words must be exquisite. In fact, some projects are invested in haste, because the loan repayment period is approaching, cash flow is exhausted, and withdrawal is also hasty, so losses are normal; but some are probably or must be strategic losses. The listed company loses money, and the hidden companies established by N shareholders abroad make money, and the primary purpose of asset transfer is achieved.
This money can lie quietly in foreign accounts, or it can flow back to listed companies along with the overseas financing trend of real estate companies, and then go around and return to the foreign country with principal and interest.
Nan Yi is familiar with this routine. He has been using it since the 1980s, but his way of doing it is relatively low-level. He is playing with his own money. All he wants is a channel for smooth inflow and outflow of funds, and to realize the operation of a pseudo-joint venture. He never thought that he could cheat a wave of shareholders by the way.
Therefore, there is only Nan Yi of the times, and there is no Nan Yi's era. He just happened to catch up with the good times, otherwise he would just be a poor guy with assets of 3 billion.
Just like during the peak period of going overseas, Nan's domestic enterprises did not think of taking advantage of this wave to achieve international operations, but short-sightedly focused on arbitrage between domestic guarantees and foreign loans.
At that time, after careful calculations, it was found that if the company participated in the investment by means of domestic guarantees and foreign loans, the actual financing cost overseas would be the interest rate difference between domestic and foreign countries. Taking into account the depreciation of the RMB , the company's overseas investment financing was actually in a negative interest rate state.
Simply put, not only do you not have to pay interest on the loan, but you will actually earn some interest. Although the amount is not much, it is free money. You can use the loan to invest in low-risk projects or acquire assets that are expected to appreciate in the future, or buy bonds. In a few years, you can make a profit of 20% to 30% of the loan amount.
Moreover, this is a win-win game. As long as the investment is profitable, there is no question of who is being cheated. There is no victim at all. Even if the investment fails, as long as the loan is repaid with interest, the only victim is yourself.
This game is not very fun and the prizes are too few. Over the past few years, Nan’s family has only harvested less than six “poor bastards”.
No matter what the deeper purpose is, unlike the Nan family, Wang Jiansen is really investing overseas. It's just that the business model of the real estate company is very localized and has almost no connection with the international community. The three tricks that are always successful in China do not work at all abroad. The simplest point is that the unruly people abroad are very difficult to deal with, and they really have the ability to ruin the project.
The small target was to use the inertial thinking of being successful in domestic projects to discover foreign projects. Looking around, there was gold everywhere. After acquiring this building, the main facade was demolished and rebuilt, and it was transformed into a luxury hotel with office and commercial areas. It was really a profitable business.
When Xiaomu was complacent with its own sharp vision and looked down on all the heroes in the world, it discovered that the main facade of the building could not be moved at all. It was for this reason that the local real estate developers had not thought of moving the building before.
Xiaomubiao had encountered several similar projects. After several years of hesitation, the funds were trapped overseas. Domestically, the company also encountered loan expiration and various cash flow problems. Selling overseas assets and transferring the money back to China to save the situation became the only option.
Wang Jiansen was full of vigor and enthusiasm in the past few years, but now he is in a dismal state of selling. While saving his business, he is also following the guidance and reducing leverage. He looks quite embarrassed for now, and it is hard to say whether he will be the one laughing the most and the one who laughs the last in the future.
Nan Yi couldn't laugh anyway. No matter whether it was Nan's, Snow Mountain Trust or his personal properties, the current housing prices were about 2.7 times the original selling prices on average. Looking at the high housing prices, he only had an old villa in his name, with no proxy holdings or company holdings. He actually had only one domestic house now. He was strong for not crying.
"Nan Yi, your room is really shabby." After Wang Jiansen was invited to sit down, he looked around the living room, "There are great scholars chatting and laughing, and there are no ordinary people coming and going?"
Nan Yi put the poured tea on the coffee table and sat down opposite him. "There is really no uneducated person here. They are all either PhDs or masters. At the very least, they have graduated from full-time undergraduate programs. College students like you who just graduated from training classes can only be regarded as illiterate here."
Wang Jiansen was not convinced when he heard this. "Stop talking nonsense. To be honest, my writing is excellent. It's hard... There aren't many people whose writing I think highly of. It's the same with you. I've read your articles in newspapers. Your writing is average, very average, not as good as mine... Just a little bit, just a little bit. In fact, I'm more of a cultured person than you."
"I got my undergraduate degree from Peking University, my master's degree from Yale, and my doctorate from Peking University. I work as a consultant for the Municipal People's Congress and receive a special state allowance every month. I am a cultured person, which has been certified by an authoritative organization. What about you?" Nan Yi gestured to Wang Dali next to Wang Jiansen, "Your son said that my father is not very educated."
Wang Dali said inwardly, "You two old men can just argue among yourselves, why drag me into this?"
To be honest, he was quite disappointed. He had heard about this Uncle Nan from his father and mother's conversations a long time ago. They said that he was a master and one of the truly wealthy hidden men in the country. He had a picture of the other party in his mind, and it definitely should not be what he saw now.
"Da Li said this to be modest. Please, help me take back my words."
"Okay, okay, if you say so, then so be it. Recently I found a piece of calligraphy in Zehang's room, 'Goodbye, little duck, I'm going to school', it has the style of Youjun, vigorous yet smooth, especially the three words 'little duck', the strokes are full of domineering power, I'll take it out for Brother Wang to appreciate?"
Wang Jiansen laughed and scolded: "Can you, can you be more serious?"
"Hahaha... OK, OK, be serious." After laughing, Nan Yi straightened his face and said, "You didn't come here just to wish me a happy new year, did you?"
Hearing this, Wang Jiansen's expression turned serious. "Last year, the remaining cash flow of Xiaomubu was more than enough to cover this year's debt repayments. However, next year's debt repayments are 47.3 billion yuan. It is difficult to have such a large amount of cash flow left this year. Xiaomubu still needs to sell assets and cut...cut business lines. At the same time, we have to find a way to refinance. It is not easy for me to refinance now, so I have to ask you to find a solution."
Nan Yi frowned and said, "Twenty or thirty, whenever you want them, I can give them to you anytime. More is a little difficult. My money is not idle, most of it is assets, and part of it is out there, and it won't come back in two or three years."
Wang Dali was in awe . "He can take out 20 to 30 billion at any time. He is a rich man. He is really a rich man."
"I'm not looking to borrow money from you personally, I just want to discuss financing options."
There is an essential difference between borrowing money from individuals and financing . The former is a matter of friendship. If you don't pay it back on time, you will lose your friendship. Besides, Wang Jiansen is embarrassed and dares not not to pay it back. Individuals are compared with individuals. The wife pays the husband's debts and the son pays the father's debts. He knows that Nan Yi is a smiling tiger who always says nice things. When the worst time comes, God knows how ruthless he will be.
The latter is a business behavior, and the friendship only reaches the point where both parties can sit down and talk, and then they only talk about interests - how much to borrow, how much interest to pay, how to repay, what kind of guarantee to use, whether to sign a bet agreement, and so on. No matter how the conditions are negotiated, the borrower is always a small target, not him, Wang Jiansen. If he cannot repay the loan in the future, it will not have much to do with him personally.
Nan Yi chuckled, "If you want to discuss financing, just give me a call. There's no need to make a special trip." After a brief pause, "Well, after the Lantern Festival, I'll organize a football match on a small field. We can watch the game while discussing financing."
