Chapter 485 Start reducing holdings

Barron's trust in Chen Fuyang also comes from Chen Fuyang's remarkable achievements in the two and a half years he has been running Avago.

When Avago was first acquired, the company was actually losing money - which is why Agilent agreed to sell their semiconductor business - when Avago was losing more than $250 million a year.

But now, in the past 12 months, Avago's net profit has exceeded $500 million!

If in the previous life, Avago achieved the goal of turning losses into profits by selling some businesses that were not in line with their development direction at that time or that were not very profitable, and carried out financial restructuring, then now it is maintaining some of the current It does not seem like a promising business, but for the future layout, under the premise of relatively important business direction, Chen Fuyang can complete Avago's transformation from an annual loss of more than 250 million US dollars to an annual profit of more than 500 million US dollars. , which can also illustrate this person’s ability.

If you look purely at financial data, Avago does have the conditions to go public.

And according to Chen Fuyang, he was also interested in another semiconductor company at this time - LSI, a memory chip company in San Jose, Silicon Valley. However, this company is higher than Avago in terms of market value and annual revenue. Chen Fuyang Fuyang also hopes to increase the market value of Avago through IPO, and then try to acquire the company.

Speaking of which, in Barron's previous life, what Chen Fuyang was best at was using this kind of capital operation to carry out mergers and acquisitions of Shetonxiang, whether it was LSI or Broadcom in the future.

In this case, Barron decided to support his idea.

…

"According to your request, we have been reducing our holdings of listed company shares, but because we need to take into account market sentiment, the reduction ratio will not be too high."

After returning to London, Barron came to the DS Financial Center in the City, and Daisy reported to him the reduction of DS Group's shareholdings.

At present, they are mainly reducing their holdings in listed companies including the London Stock Exchange, O2 Telecom, SEM Group and Argos Retail Group held by DS Holdings, Caesars Fund and Global Industrial Investment Fund.

Barron's knew that the subprime mortgage crisis was about to usher in. Affected by this financial crisis, the global stock market would fall sharply, and their listed companies were no exception. Therefore, before this, these companies under their ownership Holding companies and funds will gradually begin to reduce their holdings.

However, both Nasdaq and the London Stock Exchange stipulate that major shareholders of listed companies need to make an announcement when reducing their holdings. Therefore, the proportion of each reduction in their holdings will not be too high, otherwise it will affect other investors. sentiment, triggering a fall in stock prices.

And they also need to give sufficient reasons for reducing their holdings, such as reducing their holdings in companies such as O2 Telecom and the London Stock Exchange. The reason they gave is to meet the exchange's requirements for the proportion of circulating shares, or Need to raise funds for other investment projects, etc...

This is why they have already begun to reduce their holdings with more than a year before the outbreak of the subprime mortgage crisis.

After all, at this rate, it is impossible to say that when an economic crisis is about to break out, the reduction of holdings will be completed in a short period of time. That would be too deliberate.

And they will not say that the remaining shareholding ratio is too low, which will easily be taken advantage of by other institutions - except for Woaw Technology, which has Class A shares with 10 times the voting rights, other companies They will keep their shares at a relatively safe proportion.

In this way, the funds they obtain through reducing their holdings can also be invested in corresponding short selling of global assets. After the subprime mortgage crisis breaks out, they will not only make huge profits, but also be able to increase their holdings back to their original position when the stock price is at the bottom. proportion of shares.

In fact, not only DS Holdings and those industrial investment funds, but also securities investment funds such as Mars Fund have made plans to start reducing their holdings of some stocks, all in response to the upcoming subprime mortgage crisis.

It’s just that the Mars Fund holds many types of stocks, and each type of stock does not occupy a large proportion. Therefore, it does not need to be as cautious as an industrial investment fund, and it can start to reduce its investment in the second half of next year. hold.

…

"I heard you are planning to buy a Bentley?"

Barron met with His Royal Highness the Prince of Wales at a private club on the outskirts of the city. After waving the golf club in his hand, His Royal Highness the Crown Prince asked casually.

"Yes, Your Highness, it shouldn't be too long before this matter is finalized."

After sizing it up, Barron hit the ball...

"Beautiful, I support you in doing this, Barron. Our automobile industry once had its glory, but now it is a pity that it has been abandoned. If some brands can be brought back and carried forward, it will be the glory of the whole of Britain. "

"It's not easy to do this..."

Barron smiled and said to His Royal Highness the Crown Prince:

"Sometimes, I also need help from the royal family."

"Oh? If we can, Barron, we will help."

In the negotiations with the Volkswagen Group - although the two parties have not formally negotiated the acquisition agreement, in fact, this process has been ongoing, but the current contact with them is mainly the CEO of the Volkswagen Group, Perred.

Perred said that Kaiser Fund needs to increase its offer and agree to add the Dresden factory in Germany or another German factory to the acquisition list to help him gain an advantage in the board of directors' discussion on the sale of the Bentley brand.

What Barron knows is that Perred is likely to reach a certain compromise with Piëch, that is, to retain the Dresden factory - because the glass transparent factory there is mainly used to produce the Phaeton, the original model of the Phaeton. Although a project that Yeshi advocated has been running at a loss, when faced with different opinions, it is like this, and compromises need to be made between each other.

However, Perred still needs to reduce the burden of part of the Volkswagen Group's factories in Germany through the sale of the Bentley brand. Therefore, he hopes to add at least one German automobile factory to this acquisition agreement. What he mainly hopes is to sell the Bentley brand. The German factory has come to reduce Volkswagen Group’s auto workers in Germany in disguise and reduce salary expenses...

You know, the salary of German auto workers can be said to be the highest in the global auto industry - the current average salary of Chinese auto workers is often only 1/25 of that of German workers!

Wouldn’t it be nice to use the money from selling the factory and spend lower personnel costs to build a new automobile factory in China?