Recast youth

Chapter 1657 Meeting with Investment Banks
The so-called underwriter.

As the name suggests, it is responsible for helping Lanshan Company sell stocks. Going public in the United States seems simple, but it is not entirely a simple matter. The process of listing in the United States involves underwriters, lawyers, and auditors. , depository banks, printers, etc.

Among them, the underwriter plays the biggest role, and the underwriter is divided into lead underwriter, deputy underwriter, and special underwriter. Among them, the lead underwriter is the most important.

The listing of Lanshan Company will not only have six underwriters, but among the six top investment banks that Wen Yueqi helped Ye Feng find, one of them will become the lead underwriter of Lanshan Company.

The role of the lead underwriter in the listing of a company includes organization, valuation and sales. Organizationally, it is responsible for coordinating the work in the listing process and solving all aspects of problems to ensure that every task on the listing project schedule is completed on time or ahead of schedule. , allowing companies to seize the most appropriate time to issue stocks and go public.

In terms of valuation, the underwriters will build a valuation model based on the company's business data, financial data, and some predictions and assumptions made by decision-makers about the company's future business development, so as to grasp the value of the company's overall stock to determine the company's future listing price. The stock issuance price range and final issuance price.

In terms of sales, underwriters will enter the second half of the listing process and gain market recognition through the company's business story promotion, road shows, etc., and sell the company's shares to institutional and individual investors.

Therefore, Ye Feng set the total share capital of Lanshan Company to 3.75 million shares, and the issue price per share was US$40. This was Ye Feng's idea, and it may not necessarily be recognized by these underwriters.

Again, the lower the issuance price of Lanshan Company's shares, the better it will be for the underwriters to sell the shares. If they cannot sell the shares, then the underwriters will have to keep the shares they subscribed for first.

To put it simply, the underwriters must first subscribe for Lanshan Company's shares and then distribute them to outsiders. It is somewhat similar to how Lanshan Company is a head office, and these underwriters are agents responsible for helping Ye Feng distribute these stocks to investment institutions and investors. stock.

Originally, Ye Feng could discuss the IPO listing and stock issue price with the heads of six investment banks: Credit Suisse, Morgan Stanley, JPMorgan Chase, Deutsche Bank, Goldman Sachs and Citigroup, and first listen to their quotations.

But Ye Feng still chose to meet and talk with the heads of these six investment banks. The idea was very simple. The total share capital was 3.75 million shares, and the issue price per share was more than 40 US dollars.

In other words, the company's lowest valuation is $150 billion.

Maybe people from these companies think it's high, or they might want to use roundabout ways to lower the price, but Ye Feng's idea is also very simple. Anyone who doesn't want to, just pass out.

Because listing is a big cake, Ye Feng asked these underwriters to help Lanshan Company distribute stocks, and also paid huge labor fees to these investment banks. As long as Lanshan Company successfully went public and the stock had a good response in the securities market, not only these investment banks Investment banks can get huge labor fees, and they can also improve their ranking in the league table, so that they can win more companies to go public and choose them as underwriters.

At the same time, Ye Feng invited six investment banks to talk to him at the same time, which could also help create a certain degree of competitiveness among them, which would help encourage them to perform well.

As for not looking for too many investment banks, it is also because too many investment banks will increase the cost of coordination, which is not necessary.

Of course, there is another possibility for Ye Feng's approach, that is, although these six investment banks are in a competitive relationship, there are no permanent friends or permanent enemies in the face of interests.

The heads of investment banks such as Goldman Sachs, Deutsche Bank and Morgan Stanley must have a much better relationship with each other than with Ye Feng. After all, Ye Feng is an outsider.

Ye Feng came to the United States from China to raise money.

Therefore, it is not ruled out that these investment banks will negotiate privately to jointly lower the value of Lanshan Company, thus lowering the issuance price. After all, Morgan Stanley and JP Morgan Chase among these six investment banks are both investment banks belonging to the Morgan Group.

It is also commonly known as Big Morgan and Little Morgan in the financial industry.

However, Ye Feng is also mentally prepared for this. If these investment banks really negotiate and the price offered is not as good as he expected, then he can stop the IPO and continue to privatize Lanshan Company. After all, He is not too short of money now. With his prophetic information, he can also use limited funds to maximize investment benefits.

In a few years, Lanshan Company will be able to transform into a giant group by relying on its own operations and investments.[-] p.m.

Ye Feng, Wen Yueqi, Wang Xin, and Gao Xuan met with the heads of Credit Suisse, Morgan Stanley, JPMorgan Chase, Deutsche Bank, Goldman Sachs, and Citigroup. Although it was the first time for Ye Feng to list in the United States, these investment bank heads were Ye Feng is not unfamiliar at all.

These investment banks themselves have established divisions all over the world and in China, which are responsible for identifying promising projects that can be invested and developed. They also have dedicated regional presidents in China.

As one of the most dazzling Internet leaders in China, Ye Feng naturally has to enter the eyes of these giant investment banks, and before meeting with Ye Feng, they also did enough homework on relevant aspects.

For example, take the prospects of Lanshan Company.

and the current value of Lanshan Company.

After a short meeting and conversation.

Gao Xuan, who came to the United States to serve as board secretary this time, distributed the preliminary prospectus (preliminary prospectus, informally known as "red herring") to the heads of investment banks such as Goldman Sachs, Credit Suisse, Morgan Stanley, and Morgan Stanley.

The content includes cover, summary, company, capital investment direction, distribution policy, equity dilution, capitalization, financial data summary, management discussion, management and major shareholders, legal proceedings, securities introduction, and summary.

There is also a registration statement, which includes underwriting fees, remuneration of directors and management, the company's unregistered securities, its recent transactions and attachments, and a catalog of financial statements.

After Gao Xuan gave these investment bankers the preliminary prospectus and the registration statement, she did not disturb them and waited quietly.

And these investment bank heads and dedicated analysts and auditors analyzed Lanshan Company's preliminary prospectus. Again, listing in the United States is not an easy task.

This is a result that requires coordination from many aspects to finally come out.

The equity of Lanshan Company is not complicated. Most of the equity is concentrated in Ye Feng alone. The only three important pieces of information are the total share capital of Lanshan Company and the scheduled issuance price.

The second is Lanshan's financial data, which is one of the factors that can help determine whether Lanshan Company can support the total share capital and issuance price.

The third one is the underwriting fee given to the underwriter in the registration statement.

After these six investment banks read the preliminary prospectus and registration statement, they turned their attention back to Lanshan Company's total share capital and the intended issuance price.

The total share capital is 3.75 million shares.

The scheduled release price is $40.

That is, a market value of 150 billion means that if their investment banks want to become the lead underwriters of Lanshan Company, they must first determine the value of Lanshan Company of 150 billion US dollars.

And here comes the problem.

(End of this chapter)