Chapter 422 Mysterious Guest and Unexpected Father's Wish
Becoming a rich man, of course, he has to be generous and showy.
In the evening, a small-scale dinner to thank Pacific Network Technology for its successful IPO was held. Li Xiaofan followed the old man's approach last time and arranged it at the top Japanese restaurant MASA in New York. Tang Xinyi reserved all the seats in the restaurant in advance.
Tonight, in addition to Tim Draper of DFJ Ventures, Zheng Yingjie of Singapore GIC Special Investment Company, IDG Company, and Morgan Stanley team, Yahoo's Jerry Yang and his fiancée Akiko Yamazaki, and Softbank's Masayoshi Son and his wife Yumi Ono all came to attend the dinner to celebrate Li Xiaofan's Pacific Network Technology's successful listing on NASDAQ.
This afternoon, Pacific Network Technology's stock closed at $41.63, and its market value exceeded $800 million, far exceeding the estimate of the original lead underwriter Morgan Stanley's Mary Meeker team.
The current Wall Street investors' enthusiasm for investing in this Asia's No. 1 Internet stock is also beyond their expectations.
Among the NASDAQ listed companies, there are only a handful of companies like Singapore Pacific Network Technology that are mainly engaged in online e-commerce.
Amazon, the largest e-commerce giant in the United States, will not be listed on the NASDAQ until May 1997, and another giant eBay will not be listed until September 1998.
In the ranking of later e-commerce companies in the United States, except for Amazon and eBay, Walmart, The Home Depot, Best Buy, Costco and Macy's are all traditional companies.
Therefore, things are precious because they are rare, and the financial statements of Singapore Pacific Network Technology are still very beautiful. Not only did the company achieve profitability in the year of its establishment last year, but the financial report data in the first quarter maintained a high growth of more than 50% compared with the fourth quarter of last year.
In addition to the above factors, Mary Meeker's team analyzed that one of the factors that Pacific Network Technology Company is popular today may be that Li Xiaofan's Pacific Network Technology Company's prospectus mentioned that it will soon expand into the mainland China market.
The Use of Proceeds in the F-1 prospectus of Pacific Network Technology Company states the key uses of the IPO funds.
The purpose of the IPO funds raised by Pacific Network Technology Company is for working capital needs and potential strategic acquisitions, investments and alliances.
In terms of investment, in addition to continuing to consolidate and expand the potential of the Southeast Asian market, Pacific Network Technology Company also specifically wrote that it plans to invest in mainland China at the end of this year to expand the mainland China market with huge potential.
The founder of Pacific Network Technology Company, Li Xiaofan, and many of the senior management team are permanent residents of Singapore with Chinese nationality.
These senior management teams from China have previously led Pacific Network Technology Company to great success in Southeast Asian markets such as Singapore and Malaysia, so Wall Street investors are full of expectations for them to open up the huge market of mainland China in the future.
According to the census data in 1995, the total population of mainland China exceeded 1.2 billion.
In 1995, the population of the United States was only 266 million, and the population of mainland China was 5 times that of the United States!
Although the current GDP total is still far behind that of the United States.
However, after the reform and opening up, especially in the 1990s, the GDP of mainland China maintained a high growth trend.
In 1990, China's GDP was only 1.69 trillion yuan, and it doubled to 3.5 trillion in 1993.
Last year, in 1995, China's GDP broke through the 6 trillion yuan mark!
At present, mainland China is creating a miracle of high economic growth. Multinational giants around the world have begun to turn their attention to mainland China and try to enter the mainland Chinese market.
When buying stocks, investment expectations and the future are often the focus. Today's Wall Street investors are full of expectations for Pacific Network Technology Company!
There is even a Wall Street financial media that boldly predicts that once Pacific Network Technology Company achieves even a small success in expanding the mainland Chinese market in the future, the stock price of Pacific Network Technology Company is very likely to exceed 100 US dollars in the future, and the future market value will exceed 2 billion US dollars...
Tonight at the MASA Japanese restaurant, Li Xiaofan also specially invited a mysterious guest.
This mysterious guest came from Texas, more than 2,000 kilometers away. He is Dr. Zhang Rujing of Texas Instruments. Dr. Zhang happened to be attending a semiconductor forum at the Javits Convention Center in Manhattan these two days.
With Dr. Zhang here, another important guest, Academician Ni, must not be missed.
Li Xiaofan invited Dr. Zhang to attend tonight's event because a group of investment institutions such as DFJ, GIC, IDG, and Softbank were present tonight, considering the need for chip factories to raise funds in the future.
Four years later in his previous life, Dr. Zhang established "SMIC" in the Cayman Islands.
Later, SMIC increased its capital and expanded its shares by issuing preferred shares. Shanghai Industrial (Group) Co., Ltd. invested US$184 million, accounting for 17% of the shares and becoming the largest shareholder.
Other investment institutions such as Goldman Sachs, H&Q Asia Pacific, Walden International, and Vertex Investment Management Group under Singapore's Temasek Holdings each invested US$100 million, accounting for 10% of the shares respectively, and the remaining 11 shareholders held shares ranging from 1% to 10%.
The initial fundraising of the SMIC project was about 1 billion US dollars, and the equity was dispersed. The founder Dr. Zhang Rujing held less than 1% of the shares.
Investing in the construction of a wafer fab is really too expensive. Even in 1996, a most common 8-inch production line required at least 1 billion US dollars.
Li Xiaofan was in a hurry to arrange a meeting between Academician Ni and Dr. Zhang because he wanted to save time!
In the previous life, three years after the establishment of SMIC, on the eve of its listing in Hong Kong, SMIC was sued by TSMC in California, USA in 2003 and claimed 1 billion US dollars. At the same time, TSMC sued SMIC employees for stealing TSMC's so-called trade secrets.
This lawsuit not only made the young SMIC very passive and paid a huge amount of compensation, but also forced Dr. Zhang to leave...
In 1996, TSMC was a major shareholder and established a joint venture company called WaferTech in Washington State, USA with American companies such as ADI, Altera, and ISSI Semiconductor, preparing to build an 8-inch wafer fab with an investment of 1.2 billion US dollars.
At first, the WaferTech wafer factory was to be built in Santa Clara, Silicon Valley, California. However, because Americans regarded wafer factories as highly polluting industries, local residents opposed it. Finally, the California government had no choice but to reject TSMC's investment project on the grounds that it was "not in line with land use efficiency."
After the WaferTech project was established in Washington State, it is now the first wafer foundry in the United States, with the initial process mainly based on 0.35-micron process. In the future, in addition to semiconductor companies such as Altera, another major customer after the factory is completed and put into production is Nvidia, which is invested by Li Xiaofan!
According to Li Xiaofan's idea, it would be best to persuade Dr. Zhang Rujing to come out as soon as possible and invest in building a wafer foundry similar to WaferTech in Singapore or Shanghai to compete with TSMC!
Tonight, Li Xiaofan specially arranged a quiet corner in the MASA Japanese restaurant for Academician Ni to meet with Dr. Zhang. He believes that the two will definitely create some sparks.
As expected, Li Xiaofan introduced them to each other. The two sat down to enjoy the wine and food, and chatted. They had a great time and felt that they had met too late!
After drinking half a bottle of red wine, the slightly tipsy Dr. Zhang said to Academician Ni:
"Academician Ni, to be honest, it was my father's wish for me to come to your mainland to build a chip factory!"
Dr. Zhang's words surprised Li Xiaofan and Academician Ni.