Recast youth

Chapter 1259 Capital Leverage
Yang Qingzhi chuckled and smoked a cigarette.

People have a basic logic in doing things, that is, when you buy a product, you will only consider it if you have the money to buy it.

For example, if you only have 10 in your pocket, you will definitely go to some civilian car 4S stores. Will you go to these 4S stores such as Maserati and Porsche?

Not at all, right?

And now that he said that Freescale's purchase price has reached 150 billion US dollars, Ye Feng has seriously considered it. Doesn't this mean that Ye Feng has a way and a way to find such a large amount of money?
At the same time, this is also related to Yang Qingzhi. The next company that can be acquired is still the same. The premise is that only if Ye Feng has enough money can he discuss the acquisition.

Ye Feng doesn't have so much money at the moment, but he does have some ideas, but he hasn't said it out loud. As for Freescale, Yang Qingzhi advised him not to gamble, and Ye Feng doesn't plan to gamble either.

Although he now has many ways to make money, no matter how good the method is, it will take time and process to bear fruit. For example, using credit default swaps as a short-selling tool to short U.S. subprime mortgage products, this also takes time to explode, and only wait and see. Only after the loan crisis was fully triggered in 2007 did the fruits he planted in advance suddenly bear fruit. ?
He also knows that given time, he can make Lanshan and Lanshan Financial Services companies have a market value of over one trillion, but this also takes time, right?

No business in this world is easy.

If there is, then the only way is to go to the casino, where life or death is a [-]-[-] bet.

Therefore, Ye Feng's funds are limited now. If he really struggles to raise 150 billion US dollars and spends all the money on Freescale, and Freescale cannot make profits in a short period of time and needs to repay the company's own debts, then Ye Feng's money will be Really stuck.

“What about the Hilton?”

Ye Feng's eyes flashed and he asked: "Is the Hilton Hotel worth acquiring?"

Yang Qingzhi nodded: "The value is worth it. Hilton is one of the largest hotel groups in the world. It has 76 hotels in 2800 countries and regions, 48 guest rooms, and 10 employees. It has many companies besides the United States. In addition, if the right to use the "Hilton" trademark worldwide is acquired, it will be a very cost-effective investment. After all, the prospects of the hotel industry are also very good now."

Ye Feng asked: "What is the estimated purchase price of Hilton now?"

Yang Qingzhi said: "Currently Hilton has not been listed. If it does, it may be the largest IPO in the history of the U.S. hotel industry. I have estimated that the market value may be around US$150 billion to US$180 billion. In addition, Hilton itself has about US$65 billion. own debt problem.”

"In other words, the acquisition of Hilton Hotels is more expensive than the acquisition of Freescale?"

Ye Feng had a headache. This added up to more than 200 billion U.S. dollars. Even if he was killed, he wouldn't be able to get that much money for acquisition. Fantasy is beautiful, but reality is cruel.

"The hotel industry is a cash flow industry, and it has a wider audience than semiconductor companies, including food, clothing, housing and transportation. This is unavoidable at any time."

Yang Qingzhi then said to Ye Feng: "And I have to remind you, if you acquire Hilton Hotels and Hilton goes public, you will not be able to cash out in a short time."

"First, your acquisition of Hilton means that you hold a considerable part of Hilton's shares. The transaction costs of releasing such a large number of shares in the IPO will be very high, and it is difficult to get a more ideal price."

"Second, it will also send a bad signal to the market. Investors will think that the company's expectations are not good, the stock is overvalued, and the underwriters will be under great pressure to successfully sell and will not cooperate."

"Third, Hilton itself has considerable liabilities. This is very different from ordinary VC-backed startups. Generally, stock investors will expect such companies to use the funds raised from initial offerings to repay debts and reduce financial risks. Instead of letting us cash out, in order to ensure the success of the issuance, underwriters generally require a 180-day sales restriction period."

At this point, Yang Qingzhi said to Ye Feng: "When making any investment, especially large-capital investments, while we are optimistic about its prospects, we must also see its bad sides, and then comprehensively evaluate whether this investment is good or not." It’s worth it, but in my judgment, the Hilton Group can be a stable source of income and will not be liquidated for at least three years. If the next owner offers a very attractive premium, we can consider selling it.”

Ye Feng scratched his head a little.This is another difficult choice.

To make money by acquiring Hilton hotels, you must first pay off your own debts and reduce financial risks.

But just like he wants to own a high-tech chip company, Ye Feng also wants to own a high-end and high-end global hotel brand. This is also a period of rapid development in first- and second-tier cities in China.

Want the right to use the "Hilton" hotel trademark?

Okay, come and talk to me about the price, the franchise fee, and then give me the management fee.

In other words, I built this hotel myself. In every city I go to, I build my own five-star hotel, Hilton Hotel. It sounds very bluffing and majestic.

At least it was enough to satisfy Ye Feng's vanity, which he had never experienced in his previous life.

Thinking of this, a practical problem was placed in front of Ye Feng. He looked at Yang Qingzhi helplessly and said: "I really don't have that much money. According to what you just said, Hilton's value plus its own debt is almost 240 billion US dollars." The knife is at the mercy of me, and I am powerless.”

"nothing."

Yang Qingzhi laughed when he heard this: "If you really plan to acquire it, you don't need to spend all of the US$240 billion. You only need to spend US$40 billion."

"40 billion U.S. dollars?" Ye Feng was surprised: "Who will pay for the remaining 200 billion U.S. dollars?"

"Bank out."

Yang Qingzhi said calmly: "You can use 40 billion U.S. dollars in funds and 200 billion U.S. dollars in loans to acquire Hilton using financial leverage."

"A loan of US$200 billion? What bank can lend me so much money? I am a Chinese again."

Ye Feng looked at Yang Qingzhi with some suspicion. In Ye Feng's impression, the bank would only be the icing on the cake. It was impossible to provide help in times of need, and a loan of US$200 billion was not possible.

This must be 1600 billion yuan.

It can be said to be astronomical.

"I have to correct you on something."

Yang Qingzhi said: "First of all, what you want to do is a partnership private equity fund. Here you have to give up your personal identity and nationality and focus on investment. As long as you really decide, I can come forward to negotiate the loan, like Goldman Sachs I can talk to Wall Street investment banks such as Bank of America, Deutsche Bank, Merrill Lynch, and Lehman Brothers. In addition, they did not lend us this money out of thin air, but the Hilton hotel brand itself has such value."

"..."

When Ye Feng heard the words Lehman Brothers, he couldn't help but feel a little weird. Lehman Brothers was about to go bankrupt during the financial crisis, and now he was borrowing money from them?Is this adding insult to injury to Lehman Brothers and accelerating their bankruptcy?

(End of this chapter)