7pm, South Bank Road.
Private Room is not big, but it is elegantly decorated.
Floor-to-Ceiling Window is facing Yangtze River, and the cruise ship slowly passes by, dragging golden light traces on the river.
Zhao Chen Arrive ten minutes early.
Su Wantang followed him, wearing a light beige cashmere sweater, with her hair tied loosely behind her head. She looked gentle and quiet.
She sat down next to Zhao Chen, put her bag beside her, and then began to play with the tea sets on the table.
At seven o'clock sharp, Cheng Jiaxun showed up on time.
He wore a dark gray jacket today and looked more relaxed than the last time we met, but there was still a trace of fatigue in his brows.
"Chairman Zhao, long wait." He sat down opposite.
Zhao Chen poured him a cup of tea:
"Mr. Cheng You're welcome. I've just arrived too."
Su Wantang greeted softly:
"Mr. Cheng is good."
Cheng Jiaxun nodded and smiled:
"Miss Su is here too."
The dishes are coming one after another.
Su Wantang didn't say much, he just sat quietly next to Zhao Chen, occasionally helping him refill his tea, and occasionally turning the dishes on the turntable in front of Zhao Chen.
Cheng Jiaxun picked up the wine glass and sighed:
"Chairman Zhao, let's not talk secretly. Yunnan Agriculture, you also know the current situation. I came today to have a serious talk about cooperation."
Zhao Chen nodded:
"Mr. Cheng Please say."
The two had a drink.
Cheng Jiaxun put down the glass and thought about his words:
"We are willing to sell 10% of the shares, based on the valuation at the time of IPO filing."
He paused:
"Yunnan Agriculture's IPO plans to issue 34 million shares and raise 1.183 billion yuan.
Based on this calculation, the total market value after the issuance is about 4 billion."
Su Wantang was adding tea to Zhao Chen. Hearing these words, his hands paused slightly, but quickly returned to normal.
Zhao Chen picked up the tea cup and took a sip but did not answer the call.
Cheng Jiaxun saw that he was silent and added:
"Chairman Zhao, this valuation was reviewed by Securities Regulatory Commission and is fair."
Zhao Chen Put down the tea cup:
"Mr. Cheng, the valuation at the time of IPO application is based on the premise of 'can be listed'."
Su Wantang picked up a shrimp and peeled it quietly. The shrimp shell was intact and she peeled it carefully.
Zhao Chen continued:
"What now? The listing has been rejected.
Public Offering Review Committee Those problems - 29% of cash transactions, mismatched raw material procurement, Gross Margin anomalies, nearly 20,000 piglets died in the epidemic - which one has been solved?"
Cheng Jiaxun's face froze slightly.
Su Wantang placed the peeled shrimp on the small dish in front of Zhao Chen. He moved very lightly and made almost no sound.
Zhao Chen glanced at her, and she nodded slightly, indicating for him to continue talking.
Cheng Jiaxun was silent for a few seconds. "What Chairman Zhao thinks is the appropriate valuation now?"
Zhao Chen said:
"And 10% is too little. I want 20%."
Cheng Jiaxun was stunned for a moment and shook his head:
"20% won't work. Chairman Zhao, Yunnan Agriculture are the hard work of our Cheng family. I can't give away so much at once."
Zhao Chen picked up the shrimp and ate it. Su Wantang picked up another shrimp and continued to peel it.
"Then let's talk about valuation." Zhao Chen said, "10 times earnings ratio. Based on last year's net profit of 169 million, the valuation is 1.69 billion. 20% is 338 million."
Cheng Jiaxun frowned:
"10 times? Chairman Zhao, the lowest price-to-earnings ratio in the pig industry is over 15 times. Muyuan is almost 30 times."
Zhao Chen said:
"That's Listed Company. You can't put it on the market now, so this discount is normal."
Su Wantang put the second peeled shrimp on the Zhao Chen plate, picked up the teapot, and added a cup of tea each to Zhao Chen and Cheng Jiaxun.
Zhao Chen picked up the tea cup and took a sip:
"Furthermore, how much of your net profit of 169 million is supported by cash transactions?
Public Offering Review Committee doubts the authenticity of your finances, so this discount must also be taken into account."
Cheng Jiaxun Take a deep breath:
"12 times. It can't go any lower."
Zhao Chen shakes his head:
"11 times. That's my bottom line."
Cheng Jiaxun picked up the wine glass, took a sip, and then put it down again:
"Chairman Zhao, can we change our thinking? The valuation can be discussed, but the equity ratio, I really can't let it go too much."
Zhao Chen looked at him:
"Mr. Cheng, are you worried about the controlling stake?"
Cheng Jiaxun was stunned for a moment and said nothing.
But his expression said everything.
Zhao Chen laughed:
"I understand. If it were me, I'd be worried too."
He put down his chopsticks and leaned forward slightly:
"Mr. Cheng, I can give up Voting Rights."
Cheng Jiaxun raised his head, his eyes full of surprise:
"Give up Voting Rights?"
Zhao Chen nodded:
"Yes. I regard these 20% shares as pure Financial Investment.
Don't participate in management, don't interfere in decision-making. Voting Rights--I can even transfer it to you."
Cheng Jiaxun was stunned.
Su Wantang also stopped what he was doing and glanced at Zhao Chen.
But she didn't say anything, she just put the freshly peeled shrimp into his plate, then picked up the tea cup and took a sip.
"Chairman Zhao," Cheng Jiaxun's voice was a little tight, "What are you..."
Zhao Chen said:
"I'm optimistic about Yunnan Agriculture's team and your model. What I want is return, not Control."
He paused:
"But I also have conditions."
Cheng Jiaxun looked at him:
"You said."
Zhao Chen said:
"First, I want to send a financial officer Deputy Director. He will not participate in decision-making, but will only supervise Fund Flow.
This is my bottom line for risk control."
"Second, Board of Directors wants to give me a seat. I will not participate in the management, but Major Matter I need to know."
He smiled:
"Isn't this too much?"
Cheng Jiaxun was silent for a few seconds.
Zhao Chen picked up the shrimps on the plate and ate them slowly. Su Wantang gave him more tea.
Cheng Jiaxun Take a deep breath:
"Chairman Zhao, I need to make a call."
Zhao Chen nodded:
"Please."
Cheng Jiaxun stood up and walked out. Private Room. Su Wantang watched the door close and asked softly:
"Do you think he will agree?"
Zhao Chen said:
"Yes."
Su Wantang asked:
"Why are you so sure?"
Zhao Chen looked at her:
"Because he has no better choice."
Su Wantang thought for a while, nodded, and gave him another piece of fish.
Cheng Jiaxun dialed his wife's phone number.
"How's it going?" came an anxious voice from the other end.
Cheng Jiaxun explained the conditions of Zhao Chen.
After hearing this, my wife was silent for a few seconds:
"Give up Voting Rights? Just send a financial Deputy Director? A Board of Directors Seat?"
Cheng Jiaxun said:
"Yes. What do you think?"
The wife said:
"This man... is really sincere."
Cheng Jiaxun nodded:
"That's what I thought too."
The wife asked:
"What about the valuation?"
Cheng Jiaxun said:
"We are still talking. He wants 11 times and I want 12 times."
The wife thought for a while:
"Let's make a compromise. 11.5 times. If it's any lower, we'll lose too much."
Cheng Jiaxun said:
"Okay. I'll talk to him."
He hung up the phone, took a deep breath, opened the door and walked back to Private Room.
Cheng Jiaxun sat down opposite Zhao Chen:
"Chairman Zhao, we agree on the equity ratio."
Zhao Chen looked at him:
"Equity ratio 20%?"
Cheng Jiaxun nodded:
"Yes. But we have to talk about the valuation again."
He said:
"11.5 times. Last year's net profit was 169 million, and the valuation was 1.943 billion. 20% is 388.6 million."
He looked at Zhao Chen:
"This price is already very cheap."
Su Wantang was pouring tea for Zhao Chen. When he heard this number, his movements did not pause.
She poured the tea, put the teapot back on the table, and sat down quietly.
Zhao Chen thought for a while:
"388 million. Round up, 390 million."
Cheng Jiaxun was stunned for a moment, then smiled:
"Chairman Zhao, you are still very generous."
Zhao Chen also laughed:
"When doing business, both parties must be comfortable."
He picked up the wine glass:
"Mr. Cheng, happy to cooperate."
Cheng Jiaxun picked up the wine glass and touched it with him:
"A pleasure to work with."
The two drank it all in one gulp.
Su Wantang picked up the teapot, added a cup of tea to each of them, and said softly:
"Mr. Cheng, eat more food, it's all cold."
Cheng Jiaxun smiled and nodded:
"Okay, okay. Thank you, Miss Su."
The initial investment intention was reached, and the tense atmosphere eased instantly.
For Cheng Jiaxun, it solves the funding problem for expansion without losing Control.
For Zhao Chen, this is the first step towards diversification for Henglong.
It is also the most solid step.
Next, he will go faster and more aggressively.