A century-old wealthy family that rose from Shanghai

2020 was a watershed year in human history. The flu triggered a global crisis, a comprehensive crisis, and a crisis that lasted throughout the entire period. For at least 300 days in 2020, people were terrified of the flu, fearing that it would affect them.

On October 7, BBC News reported that Greene King, the UK's largest pub chain, officially announced that it will permanently close 25 stores and lay off 800 employees.

The news immediately caused an uproar both at home and abroad. Some international users on Reddit commented that they felt sorry for the employees who lost their jobs, but at the same time, they could understand the current predicament of the bar.

Meanwhile, data released by the UK government website shows that on October 20, the UK recorded 21311 new confirmed cases of influenza in the past 24 hours. The monthly line chart also clearly shows that since September, the number of confirmed influenza cases in the UK has been rising exponentially.

At the same time, policies to control the epidemic are being frequently introduced, which are causing continuous damage to the catering service industry.

Many Hong Kong media outlets reported that Hutchison Whampoa was preparing to acquire Green King Group last year, but at the last minute, it was personally stopped by Chan Chak-yui, thus avoiding huge losses for Hutchison Whampoa.

"The Chen family is truly remarkable. Back when they were bidding for the German 3G license, Chen Wenjie was the one who put it on hold at the last minute. Last year, when they were investing in the Green King Group, it was said that a price of £46 billion had already been agreed upon, but Chen Zerui put it on hold again. This keen eye for opportunity shows that the Chen family has been exceptionally capable across three generations!"

"you do not say!"

"However, in recent years, although Cheung Kong Holdings, Hutchison Whampoa and Power Assets Holdings have paid high dividends every year, their asset value has been decreasing and their stock prices have also shrunk considerably. This fully demonstrates that the Chen family is getting worse with each generation, and the fourth generation may only be able to 'hold on'."

"Holding on is not bad either. Although Cheung Kong Holdings has been reducing its asset value in recent years, its dividends are really substantial, which is a very high return for long-term investors."

Amidst much discussion in the market, Cheung Kong Holdings remains the biggest topic of conversation in Hong Kong.

Through these years of operations, the assets of the 'CK Asset Group' have shrunk considerably.

For example, CK Asset Holdings' land reserves in mainland China have dwindled to only 500 million square meters, a mere one-sixth of its peak size, which is almost negligible. (Evergrande had 2 million square meters.)

Cheung Kong Holdings has only 16 commercial real estate projects in six major cities in mainland China, including five Shangri-La hotel properties. In addition, the two shopping malls in Shanghai have always been the most profitable commercial real estate projects in mainland China, and the Shanghai World Financial Center is a symbol of the Chen family. As for the remaining eight commercial real estate projects, their risk resistance is naturally very high.

Cheung Kong Holdings' business in mainland China also includes the beverage and food industry, including brands such as Red Bull, Wanglaoji, Master Kong, and Nongfu Spring. These businesses are not affected by the flu and are expected to thrive.

Cheung Kong Holdings' land reserves in Hong Kong are only one-fifth of their peak value. As for commercial real estate, it has only retained core properties such as Exchange Square, Cheung Kong Plaza, Shangri-La Hotel, Cheung Kong Center, and Hutchison House. Even Central buildings such as Lane Crawford Building and Shangri-La Building (early Des Voeux Road properties) have long been sold (purchased by family offices and father-son trusts).

Of course, CK Asset Holdings still holds numerous commercial real estate projects (shopping malls, office buildings, and hotels) in major global cities such as Tokyo, Singapore, New York, Los Angeles, Vancouver, and London, which are quite valuable. In Singapore alone, it still maintains four expensive properties (three commercial complexes and one Shangri-La Hotel).

In addition, Red Bull, a product of CK Asset Holdings, has become a global functional beverage, and its 30% stake in Red Bull Europe (originally a 5% stake) is quite valuable.

CK Asset Holdings also holds a 51% stake in three other subsidiaries: Hutchison Whampoa, Power Assets Holdings and CK Infrastructure Holdings. However, it still cannot avoid the fact that, following the general trend, CK Asset Holdings' market value has been declining all year, and it is now only around HK$2800 billion (far below its net asset value).

at the same time.

Hutchison Whampoa has also completed its "slimming down" and strategic shift.

这些年，和记黄埔不仅出售了加拿大矿产企业——诺兰达鹰桥（2006）、赫斯基70%股权（从2006年开始分成多批陆续完成），还将屈臣氏50%股权出售（25%被新加坡主权基金购入，25%为上市套现）、50%港灯套现、印度电讯股权套现.
In other words, Hutchison Whampoa's main assets currently include:
Energy and minerals: 30% Husky Energy (investment in oil sands was halted during this period), resources are dwindling;

Retail and manufacturing: 50% Watson Group

Ports and terminals: 55 container terminals worldwide

Telecommunications: The second largest telecommunications company in the UK, the second largest in Hong Kong, and one of the largest telecommunications companies in many countries and regions including Italy, Spain, Belgium, Israel, Thailand, Indonesia, and Vietnam.

Infrastructure projects: water, electricity, and gas in the UK, electricity in Australia, etc.

In summary, Hutchison Whampoa's current market capitalization is over 3000 billion, a significant decrease from its peak of 1000 billion. Of course, the current market capitalization is still far below its asset value.

Another year has passed.

2021 years.

Media outlets have broken another major story: CK Hutchison Holdings is selling its 45 ports outside of Hong Kong and mainland China for US$288 billion to a consortium led by BlackRock.

The news sent shockwaves through the market.

The Wall Street Journal: Global shipping saw a recovery in 2021, with container shipping performing particularly well. Just recently, CK Hutchison Holdings renewed contracts with the Panamanian government for two ports and announced plans to invest heavily in infrastructure. Then, less than six months later, CK Hutchison sold off 45 ports worldwide, including those two.

The Dagong Daily: Whether CK Hutchison's move violates the Anti-Monopoly Ordinance remains to be seen, but it is certainly unethical.

Public pressure is mounting.

"Father, what about public opinion outside?" Chen Chuanxian asked tentatively.

As far as he knew, both his great-grandfather and grandfather were very patriotic and did not want to have a bad relationship with the other side. Even if such a relationship was unavoidable, they still tried their best to love their country and nation.

Chen Zerui calmly said, "It will proceed normally. If the authorities intervene, there's nothing we can do. But if we don't sell now, the trade competition between the world's two superpowers will escalate further, and these assets in our hands will become a hot potato."

Chen Chuanxian was surprised and said, "The trade dispute has escalated to such a difficult level? Aren't both sides engaged in some negotiations and concessions?"

Chen Zerui shook his head and said, "The pandemic will inevitably plunge the global economy into an economic crisis. The trade gap between the two sides is so huge, and the future situation is not optimistic."

In fact, even though he was 63 years old, his vision was still not that advanced compared to his grandfather and father.

The sudden sale of these ports was something my grandfather had mentioned.

Of course, at that time the global shipping index was very good, and port assets were very valuable, so 45 ports could be sold for a total of US$288 billion.

The deal between Cheung Kong and BlackRock was finally completed three months later, mainly because there was no direct official intervention from the Chinese government.

Of course, there are also some deeper reasons, namely that the trade war has not yet reached its most intense stage.

After selling these assets, CK Hutchison Holdings' cash flow increased again.

Of course, at this point, CK Hutchison Holdings no longer needed to rush to distribute dividends or make investments. Instead, it planned to distribute dividends gradually and hold cash to wait for opportunities (most of the dividends would be distributed in batches).

2023 October.

On this day, Hong Kong media gathered at the Hong Kong Funeral Home to focus on a funeral—the passing of Chen Guangliang's first wife, Yan Renmei, at the age of 108.

Even among Hong Kong's long-lived tycoons, this age is among the highest, second only to the currently living Chan Kwong-leung (113 years old) and higher than the 'movie mogul' Run Run Shaw (107 years old).

Yan Renmei passed away peacefully, without much suffering in her later years. Fortunately, Chen Guangliang was by her side at the time. The two sat in the courtyard, and Yan Renmei took a nap, leaving with a smile on her face.

Compared to when Jiang Meiying passed away, Chen Guangliang was not by her side, making him much happier.

"It's Mr. Chen Guangliang."

"My goodness, it really is Mr. Chen Guangliang! He must be 113 years old this year!"

"My goodness, he lived such a long life! Many Hong Kong citizens thought he had passed away ten years ago!"

Chen Guangliang sat in a wheelchair, pushed by his great-grandson Chen Chuanxian, and headed towards the funeral home.

Seeing the surprised reporters around him, Chen Guangliang raised his hand to greet them. The sound of camera shutters clicking incessantly filled the air, and the surrounding crowd was filled with excitement.

"My goodness, there are so many members in the Chen family, and I don't recognize most of them."

"That's perfectly normal. Sir Chen Guangliang and Madam Yan Renmei had four sons and one daughter, and more than a dozen members in the third generation, including 11 grandsons alone. They had even more great-grandsons, probably around thirty or forty, and great-great-grandsons too!"

"Is it said that Sir Chan Kwong-leung had a second wife?"

"He immigrated to the United States a long time ago, so I don't think he came this time."

Due to the flu, all members of the Chen family wore masks, taking maximum precautions to protect themselves. In fact, starting from the third generation, apart from the 'representative family members,' other members of the Chen family have maintained an extremely low profile.

For example, Chen Zerui, a descendant of Chen Wenjie, is the head of Cheung Kong Holdings. Although his sister and two brothers are also senior executives, they rarely interact with the media. In the fourth generation, Chen Chuanxian, many members don't even have photos of themselves online.

The descendants of the three Chen brothers, Chen Wenming, Chen Wenkai, and Chen Wensheng, have also generally followed this approach, keeping a low profile as much as possible.

The discussion continued uninterrupted.

"You know, the members of the Chen family who came today are almost all important figures who control Hong Kong's economy, and their influence is even global."

"Of course I know that Cheung Kong Holdings is just one branch of the Chen family. There are also the Global Group, Cheung Kong Holdings, and Ping An Group!"

Faced with the fervent enthusiasm of the crowd, the Chen family appeared sorrowful, yet maintained their composure and demeanor.

Sitting in his wheelchair, Chen Guangliang reminisced about the more than ninety years he had spent with Yan Renmei. Undoubtedly, Yan Renmei's generosity and kindness contributed to Chen Guangliang's happy life and also to the global development of the entire Chen family.

Of course, Yan Renmei is gone now, but he still has to live on.

At 113 years old, Chen Guangliang can still walk normally without any support; he's just putting on a show today.

The next day.

A photo of 113-year-old Chen Guangliang raising his hand to greet reporters and citizens has made headlines worldwide.

Some people are amazed by Chen Guangliang's longevity, some are amazed by the family's wealth, and some are amazed by the family's prosperity.

Of course, there is also online abuse:
"Did he drive up housing prices in China?"

"Invented the concept of shared space"

"Evil people have been a scourge for millennia."

2025 years.

Chen Chuanxian, the fourth-generation 'head' of the Chen family, began serving as the vice chairman and general manager of the board of directors of Cheung Kong Holdings, which was seen as the beginning of the fourth generation's rise to power in Cheung Kong Holdings.

Chen Chuanxian was born in 1985 and is only 40 years old this year. This is basically in line with the succession pattern of the Chen family: he becomes the group's general manager at around 40 years old, and a few years later he becomes the chairman of the board and general manager.

However, at this point, Cheung Kong Holdings inevitably gives the impression of "over-weighting," having sold off many assets and having a market value of only over HK$1600 billion.

Besides owning a 50% stake in CK Hutchison Holdings, Power Assets Holdings, and CK Infrastructure Holdings, CK Asset Holdings' major assets include: global shopping malls, 32 Shangri-La hotels worldwide, real estate development, office buildings, food and beverage businesses, and more.

In reality, Cheung Kong now only retains five shopping malls in mainland China, as well as those in Hong Kong and Singapore. The ownership of most Shangri-La hotels has been sold (while management rights are retained). Real estate development has shrunk significantly, and office buildings have been sold or internally traded to the Chen family. Even in the food and beverage industry, in recent years, approximately 60% of the mainland equity of several brands (Red Bull, Wanglaoji, Master Kong, Nongfu Spring, and Vitasoy) has been sold to mainland capital, with these brands continuing to operate through partnerships.

This is true for CK Asset Holdings, and also for its three major subsidiaries, which have undergone significant downsizing.

"Father"

Chen Zerui looked at his eldest son, Chen Chuanxian, seriously and said, "Now that Cheung Kong Holdings has successfully streamlined its operations and its financial situation is relatively good, you just need to remember: be steady while not forgetting development, and develop while not forgetting steadiness. I believe that the company founded by your great-grandfather will develop towards the next goal of 200 years."

Chen Chuanxian said earnestly, "I will definitely keep these in mind. The world economy is currently in a downturn, and I will remain calm and invest in stable environments and prudent industries."

"Well, let's go!"

Chen Chuanxian smiled as he watched his eldest son leave.

In fact, the Chen family's ability to withstand risks is so strong that it doesn't need to be reminded to future generations. However, the education passed down from generation to generation still needs to be continued.

Starting in 2015, the third generation began to have their own 'trust fund', still enjoying their grandfather's guidance. They diversified their investments, but the returns were extremely high.

For example, Chen Zerui's "father-son trust fund" received HK$30 billion back then, which was then invested in mainland liquor, BYD, and other companies, as well as Apple, Google, and Microsoft. He would receive a share of the money every year and then invest it again.

Over the past decade, Chen Zerui's "father-son trust fund" has grown to over US$200 billion. Currently, this trust fund is more diversified across various industries and sectors globally, demonstrating considerable stability and growth.

Shortly after Chen Chuanxian took office, CK Asset Holdings announced the sale of all its shares in UK Power Networks, one of the UK's largest power distribution networks, held jointly by subsidiaries of CK Infrastructure Holdings, Power Assets Holdings, and CK Asset Holdings. The total transaction price was £105.48 billion, equivalent to approximately HK$1107.5 billion.

This is not the first time that Cheung Kong Holdings has sold European assets. In fact, since 2020, Cheung Kong Holdings has sold European assets including telecommunications assets, water utilities, and office buildings, raising a huge amount of cash.

Chen Chuanxian explained to the media, "Only by buying and selling can a business grow bigger. We have never liked borrowing, so we always reserve funds to carry out larger transactions."

From the outside perspective, this rhythm of "cashing out - turning around - betting again" has become an important strategic feature of Cheung Kong Holdings in navigating economic cycles.

In reality, these long-term dividends and profit distributions to shareholders are the true measure of a responsible company's performance. (End of Chapter)