Chapter 648 Barclays Financing

Barclays' financing negotiations progressed very quickly - there was nothing they could do about it, after all, the deadline required by the British government was getting closer and closer. In the end, Barclays could only make some concessions in terms of the price of the additional stock issuance, but the final price of the additional stock issuance still had a certain premium, but the premium was less than 10%...

In the end, Standard Chartered Merrill Lynch, Global Industrial Investment Fund (GII Fund) and Saudi Public Investment Fund will jointly invest in Barclays.

Standard Chartered Merrill Lynch put out 4 billion pounds, GII Fund and Saudi Public Investment Fund each put out 2 billion pounds, a total of 8 billion pounds of funds, to obtain the additional shares issued by Barclays.

After this, Standard Chartered Merrill Lynch will hold 14% of Barclays' shares, GII Fund and Saudi Public Investment Fund will each hold 7% of Barclays' shares.

Standard Chartered Merrill Lynch will send a board member to Barclays with one vote, and GII Fund and Saudi Public Investment Fund will not interfere with the management of Barclays.

As an obligation to become a major shareholder, Standard Chartered Bank, a subsidiary of Standard Chartered Merrill Lynch, will also provide Barclays with a credit line of 2 billion pounds.

The reason for investing in Barclays in this way is that Barclays does not want this financing to have too much impact on their board structure - after all, if Standard Chartered Merrill Lynch conducts this financing alone, then they will get nearly 30% of Barclays' shares and become its largest shareholder.

If this is the case, it is better to go a step further and directly acquire Barclays.

However, as two of the four largest commercial banks in the UK, its regulators will definitely not allow Standard Chartered Merrill Lynch and Barclays to merge, and the merger of the two parties will not have much synergy - not only will Standard Chartered Merrill Lynch and Barclays have many overlapping businesses, but it will also drag down Standard Chartered Merrill Lynch's balance sheet to a certain extent...

After several mergers and acquisitions, the more important thing for Standard Chartered Merrill Lynch is to seize the time to complete the integration of the acquired businesses, and it is not suitable for further expansion.

"Thank you very much, Your Highness, our friendship will be as solid as a rock."

During the Barclays Bank financing process, the president of the Saudi Public Investment Fund and Prince Walid came to London and visited Barron.

They also expressed their gratitude to Barron for introducing their sovereign wealth fund to the financing of Barclays Bank.

In everyone's impression, the oil-rich countries in the Middle East, including Saudi Arabia, are all rich, and their moves are also amazing.

Especially later, these countries frequently invested heavily in technology companies and new energy...

The main reason for this is also from the sense of crisis in these countries.

After all, the environment in these countries in the Middle East is not good. It is entirely because of oil that they have become "nouveau riche". Therefore, they also have a special sense of crisis, fearing that when there is no oil or oil is replaced by new energy, they will fall into the mortal world.

Therefore, they have been actively investing in various ways with the wealth they have obtained from selling oil resources.

But unfortunately, for well-known reasons, many of their investments, especially those in the United States...are constantly being harvested by the other side.

It was also after this subprime mortgage crisis that many funds from the rich countries in the Middle East began to flow to Europe and Asia because Wall Street's greed was really ugly.

This time, being able to invest in Barclays Bank is a very good opportunity for the Saudi Public Investment Fund.

After all, finance itself is the pillar industry of Britain, and Barclays Bank, as one of the four major commercial banks in Britain, is a very good investment target even if it is in crisis now - then again, if it were not for this subprime mortgage crisis, Barclays Bank would have encountered difficulties, how could it be their turn to invest?

Barron is also relatively stable because of his actions - at least in the eyes of these rich people in the Middle East, after all, Wall Street capital always wants to harvest them, but the funds they invest in Barron have always been stable and profitable, so in their eyes, Barron is their "true friend".

In a word, it all depends on the contrast of peers.

"I saw your bold handling of the 'bad assets' of those banks, which also shows that you are optimistic about the future of British real estate, Your Highness."

I didn't expect that Prince Walid would notice Barron's recent entry into the house rental industry, but this is not too surprising. After all, his Kingdom Investment Company is also involved in many real estate projects and has also purchased real estate in London.

"Economic crises always have their cycles. With the foundation of Britain, the real estate market will definitely pick up in the future. I am very sure of this, but it is difficult to predict how long this time will be. It will take at least two years..."

Hearing Barron's answer, Prince Walid nodded:

"So during this period, by renting out real estate, you can also maintain a certain income, and your move to securitize these real estate is indeed very creative and reduces the investment of funds."

"In fact, this kind of thing has already appeared..."

Barron was referring to the securitization of the real estate of Cavendish Asset Management Company.

After all, the cause of this subprime mortgage crisis is the same as that of the subprime mortgage bond CDS, except that bonds based on subprime mortgages are more risky than real real estate.

"I just strictly controlled the risks, and now that the base interest rate is constantly falling, even a slightly lower yield is enough to attract a lot of funds."

"If possible, can I join this project?"

Prince Walid naturally did not come to discuss this matter with Barron simply. It seems that he is very interested in it and wants to invest in it:

"In fact, it's not just me. Some of my friends are also looking for suitable real estate projects. I think your project is very promising. At that time, these funds will come in through our company..."

Barron is not prepared to refuse the proposal of Prince Walid and some Middle Eastern funds to join this project. This can also help his Cavendish Asset Management Company to expand its scale at this time, and it can also help Standard Chartered Bank and other banks involved in the mortgage crisis to deal with their "non-performing assets"...

But...

"Of course, this is possible, but it should be noted in advance that the increase in funds needs to be gradual. After all, we are also slowly improving the process for house rentals. The renovation and expansion of housing sources still requires some time."