Li Ka-shing bought a 40 billion tavern and closed it after losing 1.6 billion. What was the reason?

The UK may launch a second round of epidemic blockade, with bars and restaurants closing in some areas. Under this situation, Greene King, the largest pub in the UK owned by the Li Ka-shing family, announced the permanent closure of 25 stores and the layoff of 800 people.

Due to the epidemic, Greene King has been closed for more than three months since March this year, with a huge loss of HK$1.938 billion (approximately RMB 1.6 billion) in the first half of the year. To make matters worse, Greene King, which had just resumed operations at the end of July, was once again in trouble due to the recurrence of the epidemic in the UK, so there was news of the closure of 25 stores this time.

Not long ago, Li Ka-shing’s eldest son Li Zeju came forward to stabilize the morale of the army. Although the second wave of the epidemic in Europe is still worrying, as long as the decision is made to open, the bar business will recover very quickly. This is a British culture , bars are very important to most people's daily lives. ?

The weird thing is that in the face of Li Ka-shing’s disadvantage, public opinion mostly applauded, ?Congratulations, you fled China with your capital and lost money, do you want to come back to make money again? No way?,?The British have no way? Is it so easy to get into trouble? There are also voices saying, "A skinny camel is bigger than a horse. Even if he loses so much, he still has a lot more. Moreover, he is so old and will never be able to enjoy all the money he makes in his life. It is not so miserable." Li Chaoren may not have thought that Greene King, which cost more than 40 billion to acquire, would not only lose billions and become a "joke" today, but also make the 92-year-old man bear the cynicism of public opinion.

On the Forbes Global Real-time Rich List, Li Ka-shing still ranks 42nd on the list with a wealth value of US$28.7 billion, or approximately HK$222.4 billion, while Greene King lost HK$1.9 billion. From this point of view, It is undoubtedly a drop in the bucket for it. I hope you won’t put any hat on me. No matter tall or short, I don’t want to have one. I'm not a moralist, an educator, or a conspirator, I'm just a businessman? This is Li Ka-shing's controversial statement, and for a businessman, losing money means failure. In August 2019, Cheung Kong Holdings Co., Ltd., headed by the Li Ka-shing family, announced that it would acquire Greene King plc, the UK's largest brewery and pub operator, for 2.7 billion pounds, or approximately 23 billion yuan in cash, through an indirect wholly-owned subsidiary. All issued share capital and share capital to be issued.

In addition, Cheung Kong Group will also assume Green King's 1.9 billion pounds of debt, with a total cost of about 40 billion yuan. This is another investment in the UK after Cheung Kong took over the UBS headquarters building in London. Huge investment. As of 2019, Greene King has 1,687 British-style pubs, restaurants and hotels operated by it, of which 81 have freehold or long-term leasehold rights.

Therefore, there was a view at the time that while the economy would be affected by Brexit, it would also provide an opportunity for foreign investment to "buy the dip". In this acquisition, Li Ka-shing not only bought the Greene King brand, but also its own real estate properties, which can continuously provide rentals as a stable cash flow.

For a time, Li Ka-shing was on various hot searches, and praise and criticism came one after another. The words "Don't let Li Ka-shing run away" also appeared in the headlines of the media. It is a pity that only one year later, Greene King brought this result to Li Ka-shing.