Chapter 372 Acquiring Land Group Shares for Free
With his mind made up, Lin Haoran didn't linger long at the Concord Building. After bidding farewell to Ma Shiming, he left immediately.
"Let's head to Hongkong Electric's headquarters," he instructed Li Weidong after getting into the car.
"Yes, boss!"
Three cars slowly exited the underground parking lot of the Concord Building, merged onto the main road, and headed straight for the Hongkong Electric headquarters building on Kennedy Road in Wan Chai.
Though Shixun Road and Kennedy Road were less than a kilometer apart, Lin Haoran hadn't been here for nearly a month.
Over the past month, his attention had been fully occupied by Jardines Matheson and the Land Group.
Meanwhile, Hongkong Electric, under the management of Chen Shoulin, had been progressing steadily without issues, so Lin Haoran hadn't needed to worry about it.
As he walked through the building, employees greeted him one after another, and Lin Haoran nodded back at each of them.
Having been in control of Hongkong Electric for over a year now, the employees were well accustomed to their new boss.
When Lin Haoran reached Chen Shoulin's office, he found it empty.
Upon asking the adjacent executive assistant, he learned that Chen Shoulin had gone to Lamma Island to inspect the new power plant construction progress—perfectly understandable, considering how important that project was to the entire group.
Lin Haoran didn't mind; after all, he hadn't come specifically to see Chen Shoulin.
Instead, he headed toward the accounting department.
"Where's Director Ho?" Lin Haoran asked one of the staff members after entering.
"Director Ho? Boss, you mean Deputy Director Ho Kin Ning?" the young employee asked cautiously.
"Oh, Ho Kin Ning has been promoted?" Lin Haoran raised an eyebrow, genuinely surprised.
When he had transferred Ho Kin Ning here, the man had only been the head of the accounting department—a mid-level manager at best.
Becoming a deputy director placed him among the company's senior leadership.
"Yes, boss, Director Ho was promoted last month!" the employee confirmed.
Lin Haoran nodded. Clearly, during his time at Hongkong Electric, Ho Kin Ning had quickly earned the trust of Chen Shoulin, even securing a promotion and salary raise.
"And where is he now?"
"Boss, Director Ho went over to the finance department about half an hour ago," she replied.
"Got it. Thank you," Lin Haoran said with a warm smile.
"It's my pleasure, boss," the young woman, seemingly only around twenty-four or twenty-five years old, beamed at his friendliness.
After thanking her, Lin Haoran headed next door to the finance department.
Hongkong Electric's accounting and finance departments were closely linked—two separate offices connected by an internal door, reflecting how interdependent their work was.
The accounting department provided the basic data, while the finance department conducted the analysis and made decisions based on it.
As soon as Lin Haoran entered the finance department, he spotted Ho Kin Ning deep in discussion with another senior finance executive.
Lin Haoran quietly approached and listened in.
They were discussing renegotiating loan interest rates for several upcoming maturities under the group's financial subsidiary, Huize Finance Company.
Hongkong Electric, being a highly cash-rich utility company, consistently generated massive monthly cash flows. Rather than letting the cash sit idle, the company had established Huize Finance years ago to manage surplus funds through lending operations.
With the real estate market booming in Hong Kong over the past two years, bank interest rates had surged.
Just over two years ago, when Lin Haoran borrowed from Yumin Finance, he had secured a 5% interest rate.
But now, even with Hongkong Electric shares as collateral and discounts offered by HSBC, loans were running at 10%.
By November, interest rates across Hong Kong had surpassed 15% and were still climbing.
Thus, even loyal customers of Huize Finance had no choice but to accept higher rates when renewing loans.
As Lin Haoran listened quietly, he couldn't help but appreciate Ho Kin Ning's professionalism and foresight.
When their intense discussion concluded, Lin Haoran cleared his throat to announce his presence.
Both men looked up, immediately rising to greet him.
"Boss, what brings you here?" Ho Kin Ning asked in surprise.
"I need a word with you. It looks like you were about done anyway, so I hope you don't mind me interrupting. Come with me, Kin Ning. I have something to discuss," Lin Haoran said with a smile.
"Of course, boss!"
Afterward, Ho Kin Ning followed Lin Haoran out of the finance office.
Since Chen Shoulin wasn't around and wouldn't be back soon, Lin Haoran decided to borrow his office.
Once inside, Ho Kin Ning closed the door behind him and sat across from Lin Haoran.
"You've been with Hongkong Electric for a while now after transferring from Qingzhou Cement. How are you finding it? Are you settling in well? I heard you were promoted to deputy director—congratulations, Kin Ning!" Lin Haoran said warmly.
"Boss, I owe all of this to you. Without your guidance and trust, I wouldn't be where I am today. Working at Hongkong Electric has been immensely enriching. I've learned a lot that I couldn't have picked up at Qingzhou Cement.
Chairman Chen has also looked after me well, taking me along to important negotiations, giving me exposure to areas I had no previous experience in," Ho Kin Ning replied gratefully.
Lin Haoran nodded and discreetly checked his loyalty rating.
Previously, Ho Kin Ning had a loyalty score of 95.
Now, a few months later, it had risen to 96.
Such loyalty truly exceeded Lin Haoran's expectations, no doubt due to the deep gratitude Ho Kin Ning felt toward him.
"I'm glad you're learning new things and contributing meaningfully. I actually came here today because I need your advice on a matter," Lin Haoran said with a smile.
"Please ask, boss. I will answer openly and fully," Ho Kin Ning replied seriously, sitting upright.
"You should already know I now control Jardines Matheson and the Land Group.
Recently, I've been facing pressure from British consortiums—they want me to give up Jardines Matheson's control.
I plan to use this opportunity to maximize my benefits, particularly by privatizing the Land Group completely.
But the challenge is the significant funding gap. While I can secure loans, I don't want to burden myself with too much debt, especially since I already have a 2 billion HKD loan with HSBC.
So, I need to find a way to privatize the Land Group with the least financial burden.
Currently, I hold about 19% of Jardines Matheson, which I can cash out if needed. Plus, there's the mutual cross-shareholding between Jardines Matheson and the Land Group, which I plan to resolve through mutual exchange," Lin Haoran explained in detail.
After listening carefully, Ho Kin Ning sat deep in thought for a moment.
Soon after, he pulled out a sheet of paper and a pen and began writing calculations rapidly.
Two or three minutes later, he looked up and spoke:
"Boss, based on my calculations, your 19% stake in Jardines Matheson is worth about 1.5 billion HKD.
The funding gap you face for privatizing the Land Group is between 5 billion and 6 billion HKD, depending on the final price negotiations.
Thus, your actual shortfall is roughly 4 billion HKD.
Given that you currently have about 1.3 billion HKD in cash, the final funding gap will be less than 3 billion HKD.
And boss, you don't really need to worry about this debt issue!" Ho Kin Ning said with a smile.
"Oh? Kin Ning, tell me more. Why shouldn't I worry?" Lin Haoran asked curiously.
Ho Kin Ning elaborated:
"Boss, you mentioned that the Land Group currently has about 770 million HKD in cash reserves. Once privatized, all of it will be under your direct control.
Furthermore, if you exchange shares to sever the cross-holdings between Jardines Matheson and the Land Group, it means that even if you finance the acquisition by borrowing money to buy out Jardines Matheson's 30.2% stake, the funds will still stay inside the Land Group.
Once privatization is complete, you can use the Land Group's internal funds to repay the loans.
In other words, boss, you would essentially be acquiring those shares for free.
Thus, even if you temporarily carry tens of billions in debt, it's not a real financial burden.
Your cash flow after privatization will be more than enough to manage repayments.
Boss, do you understand the full picture now?"
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