"Chairman Li, Peregrine is encountering difficulties in cash flow in its operations and needs Chairman Li to inject capital into the company." Liang Zhongtao made an appointment with Li Jiacheng on the morning of the 22nd. In the afternoon, he came to the chairman's office at the headquarters of Changshi Company and got straight to the point.
"Mr. Liang, we have been friends for many years. It's not that I won't help Peregrine when it encounters capital turnover difficulties. In business, Chairman Du has participated in the issuance of too many fixed-rate bond products in Southeast Asian countries, which has exceeded Peregrine's net profit." Assets, once the rating agency downgrades these fixed-rate bond products to C-level, these fixed-rate bond products will become waste paper, and Peregrine has no other choice but to go bankrupt." Li Jiacheng is very clear about Peregrine's asset status and does not Like Du William's investment methods and arrogant attitude towards quick success and quick profit, after receiving the call from Liang Zhongtao, he thought of a response strategy and refused to help.
Bystanders are clear! On the surface, it is a prosperous company, but in fact, the company's management is chaotic and internal strife is serious. Li Jiacheng and other Hong Kong businessmen have gone from high expectations to Peregrine led by William Du and Liang Zhongtao to disappointment.
"It's wasting Chairman Li's time!" Li Jiacheng refused, and Liang Zhongtao could only smile bitterly. In 1988, Liang Zhongtao and William Du established Peregrine International Holdings Co., Ltd. with the assistance of 15 wealthy people including Li Jiacheng, Hu Yingxiang, and Rong Zhijiang.
The initial capital of Peregrine International was HK$300 million, with Leung Chung-tao and William Du each holding 17.5%, Li Jiacheng holding 8%, and the other 14 richest people had shares.
In September 1989, when the market was still sluggish, Peregrine International, which was less than a year old and had only HK$300 million in capital, spent HK$10,000 to acquire Guang Sang Hong 30, a company with a market value of over HK$1.4 billion and a history of 70 years. % of the shares and became the largest shareholder.
The original largest shareholder of Kwong Sang Hong was Li Jiacheng. When Li Jiacheng gave up his position as the largest shareholder of Kwong Sang Bank to Peregrine, many people in Xiangjiang were puzzled. The only reasonable explanation is that Li Jiacheng was very optimistic about the future of Peregrine and the leadership wisdom and potential of Liang Zhongtao and William Du.
In February 1990, Peregrine International purchased 34.9% of the equity of the listed company Tai Sheng International Holdings Co., Ltd. through Guangdong Sang Bank for HKD 478 million. In May of the same year, it changed its name to Peregrine Investment Holdings Co., Ltd. and spent HKD 260 million. Purchased two wholly-owned subsidiaries from Peregrine International: Peregrine Capital and Peregrine Securities.
Peregrine International went public via backdoor listing. In April 1991, Peregrine Investment announced a structural reorganization. The original Kwong Sang Bank held Peregrine Investment, and it was reorganized into Peregrine Investment holding Kwong Sang Bank. The former was mainly engaged in investment banking and securities business, while the latter It focuses on real estate business and has clear responsibilities.
In the securities industry, Peregrine, through Peregrine Securities, invested in the acquisition of Yizheng Company, a joint venture between Cheung Kong Corporation and Canadian Imperial Bank of Commerce in 1991, and became one of the top 10 securities companies in Hong Kong, and became the b Chief international underwriter of the shares.
By the end of 1995, the market value of Peregrine Investment Group had reached HK$6.276 billion, surpassing Sun Hung Kai Securities and becoming one of the largest investment banks in Asia and the largest local securities company in Hong Kong.
"Leader of a group". Liang Zhongtao and William Du also joined the list of Hong Kong's super rich. As Peregrine's business developed smoothly, William Du became richer and determined not to list companies with an annual income of less than 25 million Hong Kong dollars. This arrogant attitude caused the relationship between Peregrine and Hong Kong's business giants to deteriorate.
At the end of 1996, the total share capital of Peregrine Investment Group was 10,000 shares. The main shareholders were Peregrine International Holdings Co., Ltd., Franklin Company and Xiao Xionghui, holding 25.42%, 11.93% and 0.2% respectively.
Hong Kong tycoons such as Li Jiacheng, Hu Yingxiang and Rong Zhijiang have cashed out of Peregrine and are not optimistic about the future of Peregrine.
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"Mr. Steve, due to the sudden sharp depreciation of the Indonesian rupiah, the company has encountered some difficulties in cashing out its fixed-rate debt products in Indonesia. Please inject capital from your company to become a shareholder." Liang Zhongtao was rejected by Li Jiacheng, but he was not discouraged and flew there the next day. In Chicago, USA, when I met Steve, the president of the First National Bank of Chicago, he got straight to the point.
Peregrine Investment Group has close business relationships with First National Bank of Chicago, HSBC, Bank of China Group, Deutsche Bank and Citibank.
The First National Bank of Chicago is Peregrine's largest creditor bank, and Peregrine still has an outstanding loan of US$175 million from the other party.
"Mr. Liang, now that the Asian financial crisis is getting worse, your company's business has problems. We need to cut labor costs and reduce expenditures. We don't have much cash. We can only inject US$25 million at most. What will your company offer?" Conditions?" Steve is also aware of Peregrine's current business situation, but he doesn't want Peregrine to have problems.
"We will listen carefully to Mr. Steve's suggestion. According to the conditions of the Swiss Zurich Group, at a premium of 17%, the company will give up 2.6% of the preferred shares in exchange for $25 million in cash from your company." Liang Zhongtao said before coming to the United States. Think about the capital injection conditions.
When Peregrine International was first established, in order to attract the world's top investment talents to join, Liang Zhongtao followed William Du's advice. The annual salary of the management was comparable to that of the management of Goldman Sachs and Bank of America Securities.
The annual salary of Peregrine's management exceeds 30% of that of Sun Hung Kai Securities. When the market is good, it is prosperous. Once it goes downhill, it becomes Peregrine's biggest burden.
The annual salary of Liang Zhongtao and William Du in 1996 was HK$26 million.
"Mr. Liang, happy cooperation!"
"Mr. Steve, happy cooperation!" Liang Zhongtao breathed a sigh of relief. -------On November 24, First National Bank of Chicago announced an investment of US$25 million in Peregrine, and the stock price rose 1.98% that day.
-----On November 26, due to rumors that Peregrine’s fixed-rate bond products have depreciated significantly in Indonesia, Peregrine will face huge losses this year. Peregrine’s share price fell from HK$8.35 to HK$7.59, a decrease of 9.09%. , heavy volume plummeted!
Peregrine issued an announcement overnight to refute the rumors. The company's operating activities are normal. All information is subject to the company's announcements on the media designated by the Hong Kong Stock Exchange. Investors are requested not to believe market rumors. The company will reserve the right to take legal action against those who spread the rumors.
In mid-October, in response to market rumors that due to the sharp devaluation of Southeast Asian currencies, the prices of fixed-rate bond products issued in Southeast Asian countries have depreciated significantly, resulting in Peregrine losing 300-1 billion US dollars. On October 26, Peregrine issued a long-term report. The long clarification announcement mainly includes that the company's operating activities are normal, it has reserved US$350 million in emergency funds, its relationships with all major banks are normal and its credit lines have not changed. On July 1, it repurchased 10.3 million shares at HK$7.5 to HK$11.7. William Du will not resign when talking about buying a stake in Peregrine with any party. The loss of US$31 billion is purely a rumor. The company will reserve the right to take legal action against those who spread the rumor.
