Kuaishou launched the second round of negotiations with Zhonghe Group, and Su Hua offered $10 billion as soon as he opened his mouth.

"$10 billion~"

Zhang Yida muttered softly, his brows furrowed, and he looked very embarrassed.

Su Hua looked at the negotiation team of Zhonghe Group with great interest, including CEO Lu Qi, investor Xu Xiaoming, and Zhang Yida, a total of three people.

On their fast side, it is him and Chen Yixiao, plus angel investor Zhang Fei.

Just three-on-three!

As for Penguin, Blackshirt Capital, Qiandu, and Ruixiang, these institutions did not show up, mainly to avoid suspicion.

"It's too high. ”

After a while, Zhang Yida shook his head and said, "According to this offer, the valuation of Douyin and the valuation can reach 50 billion US dollars." ”

He looked at Su Hua, "If you agree to Kuaishou's 5 shares for 1 share, I can agree to this plan!"

Zhang Fei's heart moved, and he asked: "Does the package include pindodo?"

"Huh!"

Zhang Yida glanced at Zhang Fei, thinking really beautifully.

said with a smile: "The valuation of Pindoduo is 20 billion US dollars, and if it is included, 7 shares of Kuaishou are worth 1 share of Zhonghe Group."

Merge into a new company, you can exchange 8 shares for 1 share, and issue you an additional 12.5% of the new company's shares.

Of course, this refers to a full equity swap, no cash scheme. ”

Zhang Fei laughed, "I heard that although Mr. Zhang is studying history, he is first-class in arithmetic." I saw you today, and it really deserves its name. ”

There was a thorn in the words, and Zhang Yida also heard it.

Over the years, none of the major investment institutions have gambled with him, and the venture capital circle has spread falsely, and his reputation as "calculating" has spread.

This is not a disparagement, but the greatest compliment to yourself. No matter what others think, Zhang Yida thinks so anyway.

Investors often don't want the founders to lose, because that means a lose-lose, but the founders lose more.

Saying that he is "calculating" does not only refer to calculating investors, but also refers to a keen sense of the company's development expectations, market trends, etc.

Zhang Yida chuckled, "If you count well, you won't suffer a loss, for shareholders and partners, there is a person who settles accounts for them, and they can count the money with peace of mind in the back." ”

Xu Xiaoming also came out at the right time to help, "That's right, investing in Yida can be regarded as the most correct thing I have done in my venture capital career."

He has never let us shareholders down, everyone is at ease in the back, skiing, and he makes money for us in front of the stage.

It's a little embarrassing for investors to take it so easy.

Within two months of the investment, he told me that the next round of financing was going to be made, and the investors were found......

After a while, he told me that the company was going public, and the underwriters and roadshows were all arranged......"

Zhang Fei also heard another meaning, which was talking about Zhang Yida's past achievements and trying to convey a message to himself:

Kuaishou merged into Zhonghe Group, and there will definitely be a more lucrative return on investment in the future.

Zhang Fei does not doubt that Zhonghe Group has a more brilliant future, but this is not a reason to lower Kuaishou's valuation.

On the contrary, it is precisely because Zhonghe Group may become the third pole of China's Internet in the future that it has a bright future.

Therefore, he wants to raise the valuation of Kuaishou in exchange for more shares of Zhonghe Group.

"Mr. Zhang, in this merger and acquisition, 80% or even more of the proportion is a share exchange transaction, and less than 20% of the cash transaction.

You also know that the valuation is a thing that was blown out before it went public.

Is it more than $10 billion?"

Zhang Fei shook his head, "It's not much at all, after merging Kuaishou, Zhonghe Group will be invincible in the domestic short video field."

This is of great strategic significance to Zhonghe Group.

In addition, a near-monopoly domestic short video market will also be more conducive to Zhonghe Group to tell a good story in the capital market.

Not to mention anything else, hasn't Pindodo been doing the market outside the Fifth Ring Road?

After Zhonghe Group acquired Kuaishou, it could make good use of Kuaishou's share and traffic in the sinking market, making the business of Pinduoduo to a higher level. ”

These words are true, Zhonghe Group does have endless benefits after acquiring Kuaishou.

But given Kuaishou such a high valuation, Zhonghe Group's shares were diluted, and the biggest loss was Zhang Yida, the major shareholder.

Something is good, but who doesn't want to buy it at a cheaper price?

In his previous life, when Zhang Yida was about to be reborn, that is, in October 19, the market value of Pindoduo was 45 billion ~ 50 billion US dollars, and Kuaishou's valuation was 25 billion ~ 28 billion US dollars.

A series of short video software such as Douyin, Watermelon Video and TikTok account for at least half of ByteDance's $100 billion valuation, or $50 billion.

In this life, it is expected that in two years, it should not be difficult to reach a valuation or market value of about 100 billion US dollars.

If Kuaishou can achieve the same results as in the previous life, 4 shares are worth 1 share of Zhonghe Group.

Therefore, even if Kuaishou's valuation is reported at 10 billion US dollars, and at the same time, Zhonghe Group is valued at 40 billion US dollars, it is within the psychological tolerance range of Zhang Yida.

However, it is also necessary to consider that the Douyin and TikTok in this life are much stronger than Douyin and TikTok in the same period because they started more than a year early.

So Kuaishou at this moment is definitely not worth a quarter of Zhonghe Group.

So no matter how Zhang Fei touted Kuaishou and described the benefits of the successful acquisition, Zhang Yida just didn't let go.

"Kuaishou can be valued at $10 billion, but Zhonghe Group wants to acquire Kuaishou at a valuation of $70 billion.

That's $2 billion in cash, plus $8 billion in Zhonghe shares. ”

Cash is a small issue, and the biggest dispute in M&A cases is equity.

Zhonghe Group's valuation of $40 billion or $70 billion has a great impact on Kuaishou shareholders.

According to the former, in addition to cash, Kuaishou shareholders can also get 16% of the shares after the additional issuance, while the latter only has 10% of the shares.

Su Hua, who hadn't spoken much, spoke, "Mr. Zhang, 9.5 billion US dollars, this is our last concession."

In addition, Zhonghe Group's valuation of $70 billion is outrageous, and the valuation has risen by $30 billion just after the last round of financing. ”

"That's right, Mr. Zhang, if you are sincere, you should come up with a sincere price. Chen Yixiao echoed.

Zhang Yida thought for a while and said, "It's better to be like this, you listen to my new plan."

What you're worried about is that Zhonghe Group is not worth $70 billion, right?

After Zhonghe Group's acquisition of Kuaishou, its valuation will reach $80 billion.

In addition to the $2 billion in cash, we will issue an additional 10% of the shares to the original shareholders of Kuaishou.

Your concern is, is the 10 percent of the new group worth $8 billion?"

Zhang Fei, Su Hua, and Chen Yixiao all nodded.

They think so, although Kuaishou is not worth $10 billion at the moment, the bubble is only billions of dollars.

Even if Zhonghe Group's valuation has risen a little recently, even if it is $5 billion, there will still be $25 billion in the bubble.

In terms of bubbles, it is much bigger than Kuaishou.

Zhang Yida said with a smile: "This dispute is easy to solve, let's make a round of betting, and bet that the next round of valuation of Zhonghe Group will not be less than 80 billion US dollars."

The valuation is below this number, and I will make up the difference for you. ”

Zhang Fei frowned, he saw that Zhang Yida was so confident, he always felt that there was a conspiracy!

Su Hua quickly began to mentally calculate, if according to the original plan, Kuaishou sold $8 billion to Zhonghe Group, and received $1.6 billion in cash, plus $6.4 billion in stock.

If you value Zhonghe Group at $42 billion before the merger, the post-merger Zhonghe Group will be valued at $50 billion, and the part of the stock they get is about 12.8%.

This is the most desirable result!

According to Zhang Yida's VAM plan, they received $2 billion in cash, plus "$8 billion" in stock.

The $8 billion stock, accounting for 10% of Zhonghe Group, has a certain bubble.

Based on a reliable valuation of $50 billion, the true value is $5 billion.

The difference of $3 billion can be regarded as a call option, and it is an option with Zhang Yida.

To put it simply, $7 billion is stable, and the other $3 billion is currently unstable, but with Zhang Yida's commitment to the bottom, there should be no problem.

So what does Zhang Yida earn?

I have enough confidence and confidence in Zhonghe Group, and I feel that I can win, so I throw this plan in exchange for less dilution of shares.

Su Hua analyzed the plan very thoroughly.

This plan is very beneficial to its side, and no matter how you calculate it, the target price of 8 billion US dollars has been reached.

You can do it!

Su Hua and Zhang Fei glanced at each other, but the latter shook his head slightly, signaling him not to agree.

Zhang Yida took in the looks and small movements of several of them, it didn't matter if he agreed or not, he still had Plan B if he didn't agree.

"Mr. Zhang, can we discuss?" Zhang Fei looked at Zhang Yida and asked for the latter's opinion.

"Of course it's fine!"

Zhang Fei nodded at Zhang Yida, and pulled Su Hua and Chen Yixiao to the next room.

After watching Su Hua and them pull the door and walk out, Lu Qi, who had not spoken, spoke: "If you win the bet, you have to make at least $3 billion." ”

Zhang Yida shook his head, "How can there be so many, don't you see that Su Hua is starting to loosen his mouth to 9.5 billion US dollars?"

I estimate that the bottom price in their hearts should be between $7.5 billion ~ $8 billion.

At $8 billion, we're going to pay $1.6 billion in cash, plus 12.8% of the shares. ”

Xu Xiaoming looked at Zhang Yida and said with a smile: "So you'd rather pay an extra $400 million in cash and keep an extra 2.8% of the shares." ”

Zhang Yida nodded, "According to the valuation of 50 billion US dollars after the acquisition of Kuaishou, 2.8% of the shares is 1.4 billion US dollars, and an extra 400 million US dollars in cash, there is still 1 billion US dollars to earn!"

In fact, according to Zhang Yida's own estimates, the 2.8% stake is worth only $1.4 billion.

Based on the valuation of 100 billion US dollars, it is worth at least 2.8 billion US dollars, and may even be more.

As a major shareholder with more than 60% of the shares, most of the shares earned by the pair of gambling will go into their pockets, and other shareholders will follow suit.

Lu Qi nodded, the logic here is very simple, that is, to use the bet to lower the purchase price.

On the surface, it gave Kuaishou a valuation of $10 billion, but Zhonghe Group also gave itself a premium!

And because most of the transactions adopt the equity replacement plan, in fact, the equity dilution ratio is reduced.

The risk, and there is, is this $80 billion valuation.

If this valuation is not reached at that time, assuming that it only reaches a valuation of $60 billion, the 10% stake in the hands of the original shareholders of Kuaishou is only worth $6 billion, and the difference of $2 billion needs to be made up by Zhang Yida.

"Time, to reach this $80 billion valuation, the most important thing is to bet on time.

If you say one year, you will be in a hurry, and you will not be in such a hurry in two or even three years. ”

Lu Qi hit the nail on the head and pointed out the core problem.

Zhang Yida nodded in agreement: "Yes, the main thing is time, I'm afraid a year is a bit hanging."

A year and a half, after entering 2019, the valuation will not be less than 100 billion US dollars. ”

Xu Xiaoming's face was overjoyed, and he asked, "100 billion US dollars?

Damn, I can blow this project for a lifetime.

When I get old, I will publish another book, which is called "The New Giants in the Mobile Internet Era". ”

Zhang Yida laughed, "Old Xu, you can start writing now, the book has just been completed in more than a year or two years, and it is just about to be published, and it is also gaining the popularity of Zhonghe Group." ”

Seeing that Zhang Yida was so confident, Lu Qi also thought about it carefully and felt that it was not a big problem to win the bet.

It mainly depends on the duration of the bet!

Otherwise, there is nothing else that can stop the rise of Zhonghe Group.