Chapter 793 Equity Transfer
The three options given by Osamu Suzuki each have their own pros and cons. If the model is licensed to Suzuki for production, it will add a stable source of income to Heiyun Motors. After all, the sales volume in the Japanese market itself is not high, and it is considered a dispensable existence within Heiyun Automobile Company.
Not only can you get a licensing fee for licensing, but you also get a fixed dividend for every car sold. The most important thing is that Heiyun Motors does not need to pay anything. As long as Suzuki cars are stipulated to be sold locally, it will not affect the sales of Heiyun Motors at all.
The second option can achieve a win-win situation. Establishing a joint venture factory can gain the right to speak; the profit may be higher. However, if the product is not promoted well, it will bear the risk of loss. After all, Heiyun Motors is also the majority shareholder of the factory.
The third option is relatively expensive. The Suzuki Group has a 60-year history and a profound foundation. At this time, it is just that the car is not promoted well, but other aspects are definitely not bad. Especially motorcycles and speedboats, both of which rank second in Japan.
The market value of the Suzuki Group is around US$2 billion, and a 25% stake would cost US$500 million. Even if Heiyun Motors can invest in some models, it is estimated that it will need to invest US$300-400 million. Without it, not only the Suzuki Group, but also General Motors would not be able to do it.
Bao Zixuan has done some research before, and General Motors is not optimistic about the future development of Suzuki Motors. The investment was made because GM did not have small-displacement cars, so it was considered an investment to complete the entire vehicle lineup.
However, it was discovered that the investment did not achieve the expected results. In addition, General Motors' life is not easy, and it is not even an exaggeration to describe it as the lowest point in history.
At this time in the previous life, Japanese car companies had already had a comprehensive impact on the U.S. auto industry, and the entire U.S. auto industry was left unable to fight back.
Low-end cars are no match for Japanese car companies, and high-end cars are not as good as European car companies. Although GM is the largest car company in the United States, it also means that its operating expenses are the highest. Coupled with the strong rise of Heiyun Motors, General Motors is even worse than in its previous life.
General Motors has long wanted to sell some non-core businesses to raise funds, and Suzuki Motors is already among them. This is why Suzuki Osamu dared to promise Bao Zixuan that he could buy Suzuki Motor shares from General Motors.
However, the Suzuki family does not have much funds to repurchase shares, and it is urgent to introduce strategic investment.
As long as Heiyun Motors is authorized, there are many funds and banks willing to provide loans to Suzuki. Then the Suzuki family can raise funds to buy back shares, and all problems will be solved.
From another perspective, persuade Bao Zixuan to buy shares of Suzuki Group. It is equivalent to buying an insurance policy for the family, just like when General Motors was introduced.
Bao Zixuan: "There is nothing wrong with the three options proposed by President Suzuki. I personally prefer the third option. However, GM knows that Heiyun is buying Suzuki's shares, which is scary."
At this time, in the US market, General Motors' market share was greatly eroded by Heiyun Motors. If it is another foreign car brand, it can also force intervention through administrative means. However, Heiyun Automobile itself is a domestic brand in the United States, and it does not have a complete monopoly on the automobile industry.
The market share it occupies is much lower than that of GM at its peak. Moreover, Heiyun Automobile is a major employer and taxpayer in the United States, so even the commerce department cannot interfere too much.
It makes no sense to file an antitrust lawsuit against Heiyun Automobile. Moreover, previous investigations by the Commerce Department into other subsidiaries of Heiyun have caused strong dissatisfaction among other departments. You must know that Heiyun Group is the most tax-compliant enterprise in the United States; after the Commerce Department's actions, sales have seriously declined. The tax department is certainly not satisfied; other companies' share of growth is not as large as that of Heiyun Group's tax payments.
GM has a lot of opinions about Heiyun, but they just have nowhere to vent their opinions. Now that I heard that Heiyun Motors wants to acquire the shares in Suzuki Motors, I will certainly not let it go easily. You must know that Bao Zixuan's acquisition of companies in the international market has always been synonymous with stupid people and rich money. For such a good opportunity, if you don’t give the richest man a fortune, you would be sorry for yourself.
Osamu Suzuki thought to himself that this guy really wanted shares. Although he was reluctant, he also knew that bringing in Heiyun Motors as a shareholder would be beneficial to the future. As for the shares held by General Motors, he has already thought of countermeasures.
Osamu Suzuki: "You don't need to worry about General Motors' 10% stake in the Suzuki Group, because you are buying the shares from the Suzuki family. The Suzuki family will buy back the shares from GM. There was no buyback when they introduced their investment before. Terms of Purchase.”
Bao Zixuan thought to himself that Osamu Suzuki was worthy of being a lawyer. This means that everything has been calculated and just waiting for him to come over!
But he is not angry, because Suzuki will be a Fortune 500 company in the future. Now that you have the opportunity to get shares, you won’t suffer any loss.
Bao Zixuan: "President Suzuki is really thoughtful. With your words, I feel relieved."
"I just don't know how much you value the Suzuki Group, and how much you value Heiyun's best-selling models."
It is said that Bao Zixuan is very cheerful in doing business and likes to get straight to the point. Now it seems that what he said is true.
In other words, Suzuki Group is also a large company, and its market value needs to be calculated in hundreds of millions. Now I didn’t look at any information, so I just let myself quote the price directly. Does he have confidence, or is he a fool with too much money?
However, Osamu Suzuki chose the former. If he deliberately raised his worth at the beginning of cooperation, his trust level would become very low in the future.
Osamu Suzuki: "As of yesterday, the total market value of Suzuki Group was US$2.2 billion. We calculated Suzuki's valuation based on this market value. I don't know if Bao Sang is satisfied."
Generally speaking, as long as there is a company that wants to acquire it. Basically, the price is a premium, and Suzuki's price is very kind and reasonable.
Bao Zixuan: "This price is acceptable to Heiyun Motors, and any lower would be bullying. Suzuki Motors has a profound heritage and more than 60 years of brand accumulation. President Suzuki does not charge a premium, and I have fully felt the sincerity of cooperation."
In fact, Bao Zixuan also knew that after Suzuki revealed that General Motors wanted to sell its shares, there was no other choice. If the intention to cooperate with Heiyun Motors cannot be reached, then who will support Suzuki's stock price and use the money to repurchase the shares.
But he couldn't take advantage of others' danger. Suzuki Osamu probably saw this and dared to show his trump card.
Osamu Suzuki: "As for Heiyun Motor's best-selling models, each model is priced at US$10 million in licensing fees. I know this price is a bit low, but after Heiyun Motor becomes Suzuki's major shareholder, it must have some positive impact. Otherwise, it will be difficult for me to explain to other shareholders.”
This is very true. Suzuki is not at the end of its rope yet. The worst case scenario is to give up on transformation. The sales of motorcycles and motorboats can still ensure corporate profits. If Heiyun Motors cannot bring major changes and practical benefits to Suzuki, there is no need to introduce Heiyun Capital to the company.
Bao Zixuan: "President Suzuki has already said so. I have nothing to argue with. I will just do as you say."
"Heiyun Group will pay US$550 million to acquire 25% of the shares of Suzuki Group; as for how many models are needed, Suzuki can make a list. As long as it is a model under Heiyun Motors, it can be authorized to be produced by Suzuki Motors, provided that only Can be sold in Japan.”
Osamu Suzuki did not ask too much, spending US$550 million to acquire 25% of a future Fortune 500 company; no matter how you look at it, this transaction is not a loss. It can be regarded as setting a nail within Japanese car companies, which will play a great role in the future layout of the automotive industry.
Suzuki Xiu prepared many words to persuade Bao Zixuan, but found that none of them were used. It seems that it is a pleasure to cooperate with young people, but I will have to change my thinking in the future.
Suzuki Osamu was happy, now it was Bao rich man's turn to be in trouble. I finally saved up some funds, but I have to spend them all. It seems that investment in Mongolia will slow down, otherwise the funding issue will be made a big fuss about.
It was previously promised that US$4 billion would be invested in Mongolia, but it did not say when. Now I can only make a time difference. Who can let myself be impulsive again!
Suzuki Osamu seemed to have been prepared, and immediately made a call to the United States, and at the same time took out the contract and handed it to Bao Zixuan. Any fool who sees this situation will know what's going on. It turns out that all this has been planned long ago, just waiting for him to take advantage of it.
Bao Shaofu took the contract and read it carefully. Osamu Suzuki was indeed a lawyer, and the contract was quite standardized. After reading it, he said: "Everything else is fine, but I am not very satisfied with the repurchase terms."
Osamu Suzuki seemed to have thought of it a long time ago and came up with another contract without a buy-back clause.
Bao Zixuan thought to himself, it turned out that all this was planned by others, and he really had to be more cautious when cooperating with these people.