Vol 6 Chapter 529: Shaoan

The M&A team walked in and sat down around the conference table, quiet but proud.

Under the direct guidance and leadership of Feng Yiping, this capable team is now the most reputable team in the market.

Most of them, before joining this team, did not play a key role in even a multi-million-dollar merger and acquisition case, because most of them were students who had just stepped out of school, and most of these students Most of them came to the west and Silicon Valley after the application for Wall Street failed.

There are also some small people who have passed Wall Street applications and have worked in famous companies on that street, but are still at the bottom.

Therefore, it is also a group of people who are extremely unhappy.

The distribution of bonuses on Wall Street is extremely unbalanced, and the high-level leaders can hold them to death, and the bottom-level ones can only make them survive.

If Wall Street is also a country, then it must be the country with the largest gap between rich and poor in the world.

But this group of people who have never been able to step into Wall Street or have been at the bottom of Wall Street have attracted the attention of the gold medal M&A teams of famous investment banks on Wall Street.

Their growth is beyond the surprise of those people.

At the beginning of the acquisition of Coinstar, their performance can be said to be equivalent to the interns in the eyes of professionals, that is, they know nothing.

Although they are very easy to learn, please, what can they do?

But what they have achieved now is beyond the surprise of those people.

This team is not only invincible now, but without exception, after the victory, their victory has been cultivated very richly.

It can be said that this team is a lot of people who only understand mergers and acquisitions, but there is no way to guarantee the development after the successful merger, so from the overall result, the whole merger is actually a positive teaching material for the failed team...

These people on the M&A team know that next, it will be time for them to perform.

They quietly looked at Feng Yiping sitting in the middle, who was the core and soul of their team, and they were confident that they could accomplish any goal under his leadership.

Too many big companies and big people are worried about the current situation, and even sleepless at night, but for them, this will only be the best harvest season.

John quickly began to continue his explanation, "During the recent turmoil on Wall Street, the performance of private equity funds has also been very active."

"We all know that in March, during the crisis in Bear Stearns, in addition to Xiaomo, there was also a private equity fund, the Flavos Private Equity Fund, which was intentionally acquired."

"They were very positive. They expressed their willingness to buy before Xiao Mo, and also before Xiao Mo's offer. Their quotations were also higher than Xiao Mo's. In fact, their quotations were $240 million. 12.5 times, a full 3 billion US dollars,"

Someone laughed out loud.

Flavos Private Equity Fund is really a very ambitious and ambitious private equity fund.

The problem is that their comprehensive strength is not enough to support their ambitions.

Xiaomo has formally completed the acquisition of Bearstone at the beginning of last month. Although the price they eventually paid was not 240 million US dollars, but increased to 1.4 billion US dollars, this is still far from Flavos's 3 billion US dollars. , Because it is less than half of its offer.

But it was Xiao Mo who completed the acquisition in the end, which can explain many problems.

Flavos' participation, just as it is now, adds some jokes to everyone.

John also smiled, "These private equity funds," he paused, "We all know their essence, and what we have been doing is actually the empty glove white wolf set."

"They don't have much of their own funds. Generally, after finding a suitable target, they will first borrow a large sum of money from the bank, add a portion of their own funds, and then start quoting and officially start the acquisition process."

"- Once the acquisition is successful, the private equity foundation uses the credit of the acquired company to sell bonds to the market and pay off the loan owed to the bank. After that, they become the owners of the acquired company."

"After holding these for a few years, they will generally sell the target at a higher price through ways such as listing, splitting, and being acquired."

This is the three tricks of these private equity funds.

The whole process is actually no different from the group of people in China who rely on real estate for profit.

"It can be said that these private equity fund mergers and acquisitions are mostly leveraged mergers and acquisitions,"

"Under normal circumstances, banks, especially investment banks, also like leveraged mergers and acquisitions, because they can first earn a fortune as an M&A consultant, borrow a loan for another, and underwrite bonds to earn a fortune. Some investors invested together and made a fortune..."

"But of course it does not belong to the current situation. We all know that not only investment banks but also many commercial banks are short of money. The bankruptcy of banks such as Indimei illustrates this point."

"So investment banks have been stepping up to recover similar loans recently,"

"But the dilemma faced by those private equity funds is not just in this respect. For example, let's take Blackstone as an example."

Although Blackstone is an asset management company, their largest business segment is private equity funds, so on Wall Street, Su Shiming and his Blackstone are also titled "King of Private Equity Funds".

"In February last year, Blackstone acquired EOP, the largest real estate company in China, with a consistently high leverage and bid of 39 billion U.S. dollars."

"I think the Blackstone executives should have a certain understanding of the real estate bubble, because after the completion of the acquisition, they began to deal with related assets at the speed of a blitzkrieg."

John clicked on a table again, "A week later, Blackstone sold 53 of these properties and recovered $14.6 billion, which is equivalent to 37% of the acquisition cost."

"One month later, Blackstone has sold $21 billion in assets, equivalent to 54% of the acquisition cost,"

"And three months later, about half of the property area has been split and sold, and 28 billion US dollars have been recovered, which is equivalent to 73% of the acquisition cost."

When such data came out, many people at the table were not calm.

That is, Blackstone still holds nearly half of EOP's properties, but their investment has recovered more than 70%!

And the achievement of such results was completed in just three months.

So the speed at which they accumulate wealth is really astonishing.

Even if housing prices are now declining, Blackstone's profit in this acquisition is now at least $5 billion.

"Although we don't know how much their own funds have invested, some sources have confirmed that ~www.wuxiaspot.com~ must be less than $5 billion," John added.

This is the charm of leveraged buyouts.

But some people estimate that because of the acquisition of EOP, Blackstone is currently occupying 11 billion US dollars of funds. Although most of this should come from bank loans, for now, this undoubtedly has brought a great burden to Blackstone.

"Perhaps it was inspired by the high returns brought about by this acquisition. We know that Blackstone quickly aimed at the next target. In July last year, they took the Hilton Hotel at a high price of $26 billion."

"This time, we know that they have invested $5.6 billion in free funds and over $20 billion in loans,"

"We also know that this time, they failed to repeat their last luck. The subprime mortgage crisis broke out and quickly spread to the hotel industry. Hilton's passenger flow, cash flow, and asset valuation are all greatly reduced."

"And their efforts to issue bonds did not produce any results. In the current environment, the bonds of companies like Hilton are not in a market downturn, but there is no market at all."

Therefore, they can't go on playing with their three axes.

This is probably similar to real estate speculation becoming a landlord, and it's not that real estate speculation became a landlord under normal circumstances, but Hong Kong real estate speculation became a landlord in the year of the reunification.

"At the same time, Blackstone's other investment projects have also incurred considerable losses. The funds occupied by those projects are being actively pursued by banks at this time."

John looked at Feng Yiping, "I think this is the time when we can take action."

The people on the M&A team also looked at Feng Yiping, they just waited for Feng Yiping's order.

Feng Yiping laughed, "Don't worry about it, don't worry about it,"

He stood up, "I think we can wait until the time is too late,"