How did Baoneng make Wang Shi change his mouth through high leverage?

Once upon a time, when Yu Liang talked about "The Hunter at the Door" at Vanke's annual meeting, he would never have thought that a joke that could be changed hands for only 20 billion in that year would make him a prophecy.

2065438+July 1 1 2005, when Baoneng first advertised Vanke for more than 5%, perhaps most people didn't know what it meant compared with Vanke, which is known as "the largest housing enterprise in the universe". But in less than half a year, Baoneng quickly became one of Vanke's largest shareholders with an average monthly growth rate of 5%, 10%, 15%, 20% and 23.52%.

The fighting between the two sides has been in the stage of strategic stalemate. Vanke suspends trading and plans to issue additional shares to seek countermeasures. Baoneng and Anbang hold more than 30% of the shares in one fell swoop. The two sides are at daggers drawn, and the final decisive battle seems to be on the verge. Who can laugh last, Baoneng or Vanke? Shi and Yu Liang successfully protected Vanke? Is there a deep contradiction between Baoneng and Anbang?

This frequent placard event is a vivid capital market education lesson for domestic listed companies and companies about to go public. The tender era of China's capital market has passed, and the next will be the jungle era of natural selection and survival of the fittest.

In the more mature European and American markets, the acquisition war similar to the dispute between Baoneng and Vanke is staged every day. Hunters at the gate are not uncommon, but for the China capital market, which has always been mild, all this came too quickly and too bloody. Looking back on the development of the incident, let's start with the hunter.

1

The hunters blocked the door.

Now the focus of the media is nothing more than two, one is Vanke's board of directors and management team represented by Wang Shi and Yu Liang, and the other is the legendary hunter at the door: Baoneng Department and Anbang Department.

As the representative of insurance funds in China, Baoneng was in the limelight for a while. According to public information, Baoneng Group, which was born in 1992, is a Chaoshan enterprise located in Shenzhen, and has formed a large group company with international logistics, comprehensive development, cultural tourism and financial insurance as the main body.

This company took a stake in Qianhai Life Insurance and became the spokesperson of insurance capital. The insurance capital is the main force of this round of Vanke control battle, and it is also the most dazzling "hunter" in this focus.

Similar to the United States, insurance capital is born with the impulse to buy shares in enterprises. For a long time, insurance funds were little known because they were not obvious. Until today, the acquisition of Vanke shares has gradually surfaced, revealing the tip of the iceberg. Different from the fact that bank funds need a large amount of deposit and loan spreads to maintain their operation, fund funds need to publish their earnings regularly, and paying enterprise funds requires high reserves, so insurance funds are more flexible and impulsive. The main reasons are:

First, there are a lot of floating profits in the insurance company's first payment and then payment model. Insurance companies are different from most financial enterprises. The insurance company adopts the mode of collecting first and paying later. Insurance companies often keep a large amount of cash flow on their books, although in theory, these funds are ultimately paid to the insured to ensure the payment of funds. However, under the action of the law of large numbers, compared with the probability of concentrated occurrence of insurance events, insurance companies generally do not have large-scale compensation events in a short time. Therefore, a large amount of liquidity has become the most important source of funds for insurance companies to invest in.

Second, the insurance model will bring excess profits. In recent years, the most sought-after position in insurance companies is "actuary". Through accurate model design, actuaries can make the premium income of insurance model higher than the underwriting cost, so insurance companies can not only invest in the capital retention period, but also bring a lot of excess profits through insurance model. In a sense, this kind of excess profit is that after the insurance company obtains the average underwriting profit, it obtains additional funds for the insurance company to invest with floating insurance premiums.

Third, fierce external competition leads to induced investment. With the large amount of liquidity of insurance companies, the competition in the Red Sea is very fierce, and even a premium price war will occur, which will lower the average profit level of enterprises and make insurance companies have to invest the money in suitable investment fields. Otherwise, in the event of concentrated disasters or special risk events, years of investment income will often be eaten up by one or two emergencies, and even insurance companies will go bankrupt. This is the reason why Hurricane Katrina led to the bankruptcy of insurance companies.

Based on the above three reasons, insurance companies must choose appropriate investment targets and try their best to whitewash the risks they face. Compared with high-risk stock market, low-yield bond market and imperfect internet financial market, equity assets of equity and financial investment are undoubtedly the best choice, which is also the fundamental reason why insurance companies are willing to brand well-known enterprises one after another for many years and realize equity investment.

2

Market logic behind high leverage

As can be seen from the above, insurance funds have a natural impulse to invest in equity, just as Anbang has invested in Minsheng Bank and controlled many capital enterprises in recent years. But why Vanke this time? The reason is that, as a listed company without controlling state-owned shareholders, Vanke's shares are scattered, shareholders' control over the company is insufficient, there are no protective clauses such as one-vote veto by the founder or the founder's shares become gold shares in the company's articles of association, and the nomination method of directors is more market-oriented, so it is a natural object of equity investment.

On the other hand, as the largest real estate enterprise, even known as "the largest real estate enterprise in the universe", Vanke's share price has been low and its P/E ratio has been hovering at a low level for a long time, making it an excellent investment choice for insurance funds.

However, as a super-large real estate enterprise, it may be easy to realize financial investment, but it is more difficult to realize equity control. In order to achieve the purpose of equity control, Baoneng Department adopted the most common mode of capital market: adding leverage.

Speaking of leverage, many people may not be familiar with it, but when it comes to the off-exchange fund-raising storm in June this year, I am afraid there will be no unfamiliar people. This is the obvious leverage model. Judging from the materials disclosed now, the first model used by Baoneng Department is off-site fund-raising. With the help of Huatai Securities and Galaxy Securities, Baoneng borrowed a lot of off-exchange funds from the capital market and bought stocks through capital allocation, thus inciting the capital far higher than Baoneng's own investment level to operate in the secondary market. The continuous daily limit in just a few days is enough for Bao to earn a lot of money.

In addition, the insurance company's own whole life insurance (also known as universal insurance) is used for financing. As long as Baoneng's return on investment is higher than 10%, it can balance the cost for a long time and realize risk hedging for Vanke. On the other hand, Vanke, as one of the largest housing enterprises in China, has recently been stimulated by a series of real estate dividend policies. House prices in first-tier cities generally rose, while second-and third-tier cities picked up. As long as there is no large-scale real estate collapse in the future, it is not difficult for Vanke's equity investment to achieve a return on investment of more than 10%.

Short-term leveraged buyout and long-term universal insurance financing have to say that Baoneng has played a good hand. Looking back on China's capital market, M&A has not been the mainstream in China market for a long time. Apart from the early Zhong Yan industry, there is not even a case that can be used as a textbook in the capital market for more than a decade, which also makes it impossible for China enterprises to form a sense of crisis. Vanke's founder team can even give up absolute control over its board of directors and equity, which is almost impossible in European and American markets.

When the bargain hunters at the door use the market model and combine short-term and long-term financing to launch the acquisition of Vanke, it is not a fantasy, but the inevitable result of the development of China's capital market and the logic of the market.

three

Profound educational function

Regardless of the outcome of the dispute between Vanke and Baoneng, investors and business owners in China should thank the participants in this dispute, because they have taught China enterprises a lesson with their own cases.

Malicious takeover may not be a happy thing for business owners and operators, but for the whole market, the existence of door hunters is like a catfish, which stirs up the whole market, promotes the circular metabolism of the market, eliminates enterprises that can't keep up with the market trend, and makes China enterprises mature rapidly, and its positive role will outweigh its negative role.

"Wanbao Controversy" is not just a case, it is opening an era of all-round marketization and competition in China's capital market, and the curtain of history is slowly rising, but we will wait and see.

Viewing Jiang Han, the official account of World WeChat from an economic perspective ID: jianghanwiew