A century-old wealthy family that rose from Shanghai

Just as Chen Guangliang and his wife were visiting relatives in mainland China, the stock of Wharf Holdings in Hong Kong suddenly surged, and rumors circulated in the market that a Chinese tycoon was acquiring Wharf Holdings.

In a short time, Wharf Holdings' stock price quickly climbed from HK$18-20 to nearly HK$30.

With the unusual rise in Wharf Holdings' stock price, major conglomerates and ordinary people in Hong Kong began to realize that someone was eyeing Wharf Holdings, and they flocked to the market, further pushing up Wharf Holdings' stock price.

Global Group Building.

Chen Wenming is having a secret meeting with his second uncle and cousin.

"Brother Wenbo, how many shares of Wharf Holdings do we hold?" Chen Wenming asked directly.

Now that my father is not in Hong Kong, he is the head of the Global Group. Although my second uncle has stepped down from his frontline position, he is still a director of the company, so he was invited to discuss the matter.

Chen Wenbo said, "I already hold 18 million shares, accounting for 1800% of the total share capital, which should have surpassed Hongkong Land to become the actual major shareholder of Wharf Holdings."

Chen Wenming nodded and said, "Now that the operation has been leaked in advance, let's not hide anything. Let's continue to acquire scattered shares on the market and push the share price up to over 45 yuan. The purpose of doing this is twofold: first, to prevent Jardine Matheson from increasing its stake (because the price is too high), and second, to increase our shareholding to over 20%. If we add the 5% stake held by Ping An Investment, then we can enter the board of directors with an absolute shareholding advantage!"

Chen Wenbo nodded and said, "Yes, our acquisition is continuing and has not stopped."

At this moment, Chen Guangcong said, "Wenming, why not take the plunge and publicly acquire Wharf Holdings? After all, the cash flow of Universal Group is enough to leave Hongkong Land with no chance to fight back."

There was no need to borrow from banks to acquire Wharf Holdings.

Chen Wenming said sincerely, "Second Uncle! Actually, I think the same way as you, but Father once instructed that we should first join the board of directors and play and fight with the people from Jardine Matheson. Of course, Father's intention is still to wait until the political situation is better and public opinion is on our side before we can take over Wharf Holdings in one fell swoop."

Upon hearing that it was his elder brother's idea, Chen Guangcong fully understood the key point.

The fact that the eldest brother suddenly visited the mainland first has shocked many people if the news breaks. Has this Chinese leader, who has always ignored the mainland, changed his political views? And isn't he afraid of being detained and never being able to return to Hong Kong?

"Yes. Now it's your turn to shine as young people. Your father trusts you, so go ahead and do what you're willing to do."

"Thank you, second uncle!"

After his second uncle and cousin left the office, Chen Wenming's face showed a determined expression; he was determined to make this acquisition a success.

He understood that his father only wanted to give them direction, but the real battle would have to be fought by them.

Later, he picked up the information about Wharf Holdings and read it carefully again, finding it increasingly informative.

Wharf Holdings is a major trading company under the Jardine Matheson Group (Jardine Matheson holds a smaller stake, while Hongkong Land holds a larger stake, though together it is estimated to be only a little over 15%). Its former site will become the most valuable land in Kowloon, while Wharf Holdings' stock is undervalued. If developed properly, it has a bright future.

Wharf is not a warehouse in the strict sense, but Hong Kong's largest cargo port, with deep-water piers, open cargo yards, and cargo warehouses.

In 1886, Paul Chater spearheaded the establishment of a dock warehouse in Kowloon, with Jardine Matheson being one of its major shareholders.

Wharf Holdings is a listed company within the Jardine Matheson Group, and together with Hongkong Land, it is known as one of Jardine Matheson's "two wings".

Kowloon Warehouse Limited's properties include most of the wharves and warehouses in Tsim Sha Tsui, Kowloon, the New Territories and Hong Kong Island, as well as hotels, buildings, trams and Star Ferry.

With a long history and substantial assets, it can be said that whoever owns Wharf Holdings controls most of Hong Kong's cargo loading, unloading, storage, transportation, and ferry services.

Jardine Matheson, the parent company of Wharf Holdings, is known as one of the four major trading houses in Hong Kong, along with Hutchison Whampoa, Swire Group, and Wheelock.

Jardine Matheson became the most powerful of the four major trading houses, and the Jardine Matheson taipan was also the chairman of Wharf Holdings, which shows that Wharf Holdings played a very important role in Jardine Matheson.

Cheung Kong Holdings has always considered Hongkong Land a competitor, and Wharf Holdings attracted the attention of the Chan family, which led to Wharf Holdings' relocation.

Tsim Sha Tsui, which faces Central District on Hong Kong Island across the sea, is increasingly becoming Hong Kong's tourist and commercial district. After the relocation of the railway terminus to the east, Wharf Holdings moved its freight business to Kwai Chung and Peninsula West, and the land vacated was used to develop the commercial building - Harbour City.

Chen Wenming praised the founder of Wharf Holdings for acquiring this prime location at an extremely low price, and how its value has now increased a hundredfold.

Wharf Holdings has built famous buildings such as Harbour City and Ocean Centre, but its business practices are not commendable. They insist on using their own assets to build buildings and only rent them out, which has resulted in slow cash flow and plunged the group into a financial crisis.

In an attempt to resolve the crisis, the group sold a large number of bonds to raise cash, which in turn led to a surge in debt, a decline in its credit rating, and a devaluation of its stock.

“Harbour City and Ocean Terminal are excellent commercial real estate properties. My father once said that the shipping industry would decline in the early 80s, and the World Trade Center Group had to ‘reduce its ships and go ashore.’ Wharf Holdings Group was simply an excellent opportunity.”

"Star Ferry operates the ferry terminals in Kowloon and Central."

“Hong Kong Tramways controls the transportation on Hong Kong Island. Most importantly, the main plant site that Hong Kong Tramways owns in Causeway Bay is an excellent commercial site that can be developed into the most beautiful integrated commercial center in Causeway Bay.”

Thinking of all this, Chen Wenming revealed a victorious smile.

Although Wharf Holdings has not yet made the acquisition, given the strength of Universal Group, it could take down not only Wharf Holdings, but also Hongkong Land. Of course, their father also taught them to think about things from a broader perspective.

By the end of the month, Wharf Holdings' stock had soared to HK$48 per share, more than doubling from HK$14 at the beginning of the year.

At this point, Jardine Matheson was already in a panic.

At that time, the head of Jardine Matheson was Newbikin, not a member of the Keswick family. Henry Keswick returned to Britain to participate in politics in 1975, and Newbikin became the head of the non-Keswick family. This also fully demonstrates that the Keswick family did not hold a large share in the Jardine Matheson group and could not achieve a monopoly.

Newbikini urgently convened a meeting of senior executives from Hongkong Land and Wharf Holdings to discuss countermeasures.

"What should we do, everyone?"

Hongkong Land CEO Bedford said, "A week ago, we also acquired some shares from the market, but because the price was too high, we only managed to buy 30 shares. Now, Hongkong Land holds an 11.2% stake in Wharf Holdings."

Newbikin's face darkened. He said, "Jardine Matheson holds 5.6% of Wharf Holdings' shares. Judging from the rise in Wharf Holdings' share price, it seems that Universal Group has already acquired a stake in Wharf Holdings and surpassed us to become the nominal largest shareholder. And right now, Wharf Holdings' share price is as high as HK$48 per share. Our strength is not enough to defeat Universal Group!"

The World Group is the largest conglomerate in Hong Kong; Cheung Kong Industries is the second largest; and HSBC is the third largest.

As early as the early 70s, the Universal Group owned a fleet of 2000 million tons, a presence that even the US government needed to court, because it surpassed the Soviet Union, after all, it was an American merchant fleet.

At this point, the deputy general manager of Hongkong Land, Paul Bo, said, "The only thing we can do now is to ask HSBC for help! As long as HSBC is willing to help us, even if the Global Group ignores their advice, HSBC can make the Global Group's acquisition fall through by providing us with a loan."

As soon as these words were spoken, everyone's eyes lit up.

If HSBC provides an 'unlimited loan,' then Jardine Matheson and Hongkong Land can save Wharf Holdings.

Newbikin also said, "This is a great idea! And HSBC certainly doesn't want the Global Group to continue to grow bigger. After all, they've been third for so many years and they also hope to one day return to the top position."

Although Global Group and Cheung Kong Industrial Group were not listed companies, anyone with a brain knows that HSBC only earned more than HK$5 million a year (1976), but Global Group and Cheung Kong Industrial Group certainly earned more.

The Worldwide Group owns an 1800 million-ton fleet, a 50% stake in Hong Kong Airlines, and Worldwide Trading, among other assets. The Cheung Kong Industrial Group, on the other hand, employs nearly 10 workers and influences Hong Kong's industry.

Neither of these companies were companies HSBC could easily provoke; HSBC was merely a junior partner. Sure enough, after Newbikini's distress call, HSBC's CEO, Sir Michael Sandberg, immediately began to formulate his own scheme.

He convened a meeting and discussed with his colleagues how to help Jardine Matheson.

"We must not allow the Global Group to continue to grow bigger. It was already a maritime hegemon. If it were to interfere in Hong Kong's land-based business, it would be very difficult for HSBC to surpass Global and Cheung Kong in the 1980s."

The colleagues all nodded in agreement, their attitudes surprisingly unanimous.

A senior executive said, "Although we have decided to help Jardine Matheson, there is no need to directly conflict with the Universal Group. After all, we also have cooperation with Hong Kong Airlines and several ships. So, we will lend some money to the Jardine Matheson Group first, so that the Universal Group will back down."

This suggestion is excellent, and everyone agrees with it.

In reality, HSBC was unlikely to lend a large sum of money to the Jardine Matheson Group, as they were not a charitable organization. Therefore, HSBC's idea was to lend a small amount to stabilize the Jardine Matheson Group while simultaneously discouraging the Global Group from further investment.

Sir Michael Sandberg nodded and said, "Alright, let's not get involved directly for now. Let's lend Jardine Matheson HK$2 million to show our stance."

HK$2 million is not much, considering that Wharf Holdings' market value is already close to HK$50 billion.

After receiving support from HSBC, Jardine Matheson immediately made a symbolic purchase of Wharf Holdings shares on the market, while simultaneously releasing the message that Jardine Matheson had received support from HSBC and would fight to the end.

However, Chen Wenming did not panic in the face of Jardine Matheson's "stubborn resistance" and HSBC's "intervention." He understood one thing: HSBC could not provide unlimited support to Jardine Matheson, but the Global Group would not take HSBC and Jardine Matheson seriously.

“Continue to increase our holdings, buy another 5% of the shares, and then our shareholding will be 30% (including Ping An Investment's 5%), that will be enough insurance!” Chen Wenming said without hesitation.

To put it simply, the 20% stake currently held by Universal Group, which is 2000 million shares, has an average price of only HK$30 per share, costing only HK$6 million.

At this time, Universal Group had $5 million in cash flow and $2 million worth of Japanese securities.

Chen Wenbo then said, "Why don't we sell a few million shares first to drive down Wharf's share price, and then switch our strategy to acquire it? After all, Jardine Matheson is just bluffing. This way, we can buy Wharf shares at a lower price."

Chen Wenming immediately refused, saying, "There's no need for that. Besides, I don't want to give Jardine Matheson any chance! At least until we add Ping An Investment's 5% stake, reaching a 30% shareholding, we cannot give Jardine Matheson any chance."

Seeing this, Chen Wenbo did not refute, and said, "Okay, I will continue to arrange the acquisition."

Mr. and Mrs. Chan returned to Hong Kong in early November. The trip lasted 40 days, during which they visited many places, including Beijing, Shanghai, Ningbo, Hangzhou, Wuhan, Chengdu, and Chongqing.

It was precisely because everyone was poor at that time that they were able to feel the country's plight. Even if Chen Guangliang were able to move around after 2010, he would not want to return to the mainland.

Upon returning to Hong Kong, the "Battle of Wharf Holdings" had reached a fever pitch, with Universal Group announcing on November 8 that it had acquired a 30% stake in Wharf Holdings.

When Jardine Matheson's Newbie Ken heard this, he broke out in a cold sweat; the speed was simply too fast!
As is customary, the board of directors of Wharf Holdings Limited had to invite Universal Group to join the board, and the Chan brothers, Chan Man-ming and Chan Man-bok, became directors of Wharf Holdings Limited.

Now that Chen Wenming is 42 years old, Chen Guangliang can completely step down and work behind the scenes.

At Wharf Holdings, the cousins ​​Chan Man-ming and Chan Man-bok were at odds with Newt Bikin and others, and they all disliked each other.

this day.

Chen Guangliang invited HSBC executive Sir Michael Sandberg to the top floor of the Ping An Bank Building.

Sir Michael Sandberg was somewhat surprised—Chen Guangliang did not personally participate in the acquisition battle of Wharf Holdings, but instead came to him alone. Could it be that he was trying to persuade HSBC to give up supporting Jardine Matheson?

But soon he discovered that things were not like that.

Chen Guangliang slowly put down his teacup and then said, "Hong Kong is too small."

Shen Bi also relaxed and said with a smile, "Indeed! So competition is inevitable, but the good thing is that everyone can still sit down and have a cup of tea in peace. That's the business world!"

No one found Chen Guangliang's joke funny. Instead, he continued, "But whoever can break out of this circle and become a world-class enterprise will be the winner!"

Sir Michael Sandberg's expression calmed down. He thought that Chan Kwong-leung was mocking HSBC, since HSBC at most had business in Asia and the UK, but Hong Kong was still its top priority.

He said calmly, "It's fine if it's a little later!"

The implication is that HSBC also has the capability to expand beyond Hong Kong, and shouldn't assume that it's just your Global Group and Cheung Kong Industrial Group.

Chen Guangliang suddenly laughed at this moment, and then said, "Mr. Shen Bi, have you ever heard of the American Sino-Finance Bank?"

Sir Michael Sandberg asked in surprise, "Why does Sir Michael ask that?"

Chen Guangliang cut to the chase and laid his cards on the table: "If HSBC wants to break through, it must consider entering North America. Only by acquiring American banks can HSBC truly become a world-class bank. As the sixth largest bank in New York and the largest retail lending bank, HSBC is undoubtedly a good bargaining chip. And I happen to have a way to sell you 51% of HSBC's shares! Of course, HSBC can choose not to accept it, but that will be difficult for you!"

Sir Michael Sandberg immediately asked, "What does Sir Chen want?"

He thought that Chen Guangliang wanted HSBC to stop supporting Jardine Matheson and had already agreed.

To everyone's surprise, Chen Guangliang said, "Cheung Kong wants Hutchison Whampoa!"

Sir Michael Sandberg was taken aback by the ambition of the Chan family, who, while acquiring Wharf Holdings, also had their eyes on Hutchison Whampoa.

"Cheung Kong is already so powerful, Hutchison Whampoa seems to be even stronger."

This time it's different. Hutchison Whampoa doesn't have the advantage of container terminals, and its retail business is being crushed by Lane Crawford Group.

Chen Guangliang said with a smile, "Cheung Kong Group needs British talent from Hutchison Whampoa in order to expand overseas."

Sir Michael Sandberg then asked, "Sir Chan, aren't you worried about Wharf Holdings?"

Chen Guangliang laughed and said, "That's not HSBC's bargaining chip. I don't believe HSBC can unconditionally support Jardine Matheson. What benefit would that bring you?"

This confidence impressed Shen Bi.

To put it bluntly, they are not worried at all about HSBC supporting Jardine Matheson; they are ready to fight if asked.

Indeed, that was the case. HSBC lent Jardine Matheson a limited amount of money, simply because they were worried that Jardine Matheson wouldn't be able to repay it.

Next.

The transaction with HSBC is still under review by both parties. HSBC needs to ascertain the situation of SITC, while CK Asset Holdings is also preparing to investigate Hutchison Whampoa. Neither party is in a hurry to reach an agreement immediately.

As for the takeover battle at Wharf Holdings, it has temporarily ceased due to the entry of Universal Group into Wharf's board of directors; the share price has also fallen from a high of over 60 yuan to less than 50 yuan. (End of this chapter)