On Sunday, December 7, the Hong Kong Economic Times, a subsidiary of Huayi Brothers Media Group, published an article written by Li Hualong himself, "The Hidden Crisis After the Soaring Stock Price of Jianing Real Estate".

As early as more than two months ago, Li Hualong discovered that there was a problem with a listed company named Jianing Real Estate, and he specially asked the reporter of the "Hong Kong Economic Times" to secretly collect information about this company, and dug up a lot of insider information, and it was with these materials that he wrote this article.

The writing level of the article "The Hidden Crisis After the Stock Price Soaring of Jianing Real Estate" is not high, but the content contained in it makes many people very surprised after reading it, and since then, Li Hualong has a nickname of "Li Cannon", which means that he dares to speak.

The full text is as follows:

Before the main text begins, I would like to say a cliché warning: the stock market is risky, and investment needs to be cautious.

I've often said to my friends and family before: I'm afraid when others are crazy; When others are afraid, I go crazy.

In recent months, a number of newspapers in Hong Kong have often published news about Chen Qingsong, Jianing Group, Henkel Enterprise and Jianing Real Estate

First of all, this newspaper declares that I have no conflict of interest, nor do I have any business dealings with Mr. Chen Songqing, nor anyone related to Jianing Group and Jianing Real Estate, and the main reason why I am concerned about this matter is that I want to see the healthy development of Hong Kong's financial market, and I feel that this is my responsibility as the honorary chairman of the Hong Kong Stock Exchange.

As far as I know, Mr. Chen Songqing has been rapidly expanding his personal assets in the eyes of outsiders in the past year or so.

I won't talk about what business Chen Songqing originally did. Just write about some of the things that have been with him for the past year or so.

In July 1979 last year, Chen Qingsong mortgaged three land parcels in Yuen Long, New Territories, to U-Ming Marine Finance and borrowed HK$50 million. Subsequently, due to the rise in land prices, U-Ming Marine Finance increased Chen Songqing's loan amount.

Many people may not know the financial situation of U-Ming Mintilly I would like to introduce this company here, the parent company of U-Ming Marine Finance is the state-owned bank of Malaysia - U-Ming Bank,

U-Ming Bank has set up a service network in Malaysia to assist farmers in setting up their businesses, providing banking services and business advisors to farmers. The bank has multinational divisions, with branches in London, Los Angeles, Tokyo, Bahrain, New York and Singapore. Serve its customers. It was logical to set up a branch in Hong Kong, but since Hong Kong's financial regulations did not allow the bank to set up a branch, U-Ming Bank set up a deposit-taking company in Hong Kong in the form of a subsidiary, U-Ming Marine Finance Sdn Bhd Malaysia, which was established in 1974, but it was not until 1977 that the business really became active.

From the people who have dealt with U-Ming Finance, we know that U-Ming Finance does not supervise whether the loan is used for the purpose of the loan application, they only care about whether the borrower pays the interest, even if the interest is paid by the new loan in the future.

How Mr. Chen Songqing obtained the loan from U-Ming Education, I will not speculate here, but as the chairman of Hang Seng Bank. I would like to advise U-Ming Marine Finance that it is a dangerous thing not to monitor whether the loan is used for the purpose of the loan application.

In October last year, Baoguang Group, the holding company of Meihan, spun off and sold Meihan's assets, and Chen Songqing negotiated the purchase of individual assets of Meihan on the one hand, and hinted at the possibility of buying the entire company on the other. By December 27, the Securities Regulatory Office received a notice that as of Christmas night, Jianing had acquired 52.6% of Meihan's shares, and had sold a large number of assets before the acquisition was finalized.

Before Jianing's acquisition of Meihan. Mayhand's shares were priced at HK$1.5 per share for most of 1978 and 1979, and by the time Mayhan was temporarily suspended on December 27, the share price had risen to HK$3.8 per share. The proposed purchase price is HK$6 per share, subject to payment on the basis of deferred payment. Baoguang agreed to the deal. The premise is that Baoguang buys some properties of Meihan Company for HK$100 million.

At the time, the Securities Regulatory Commissioner pointed out that the deal violated the Takeovers Ordinance at the time, and that as the acquirer, Jianing did not issue a public takeover offer, and did not conduct an asset appraisal and convene a general meeting, which caused widespread concern among investors. However, there were no regulations at the time that allowed the Commissioner of Securities to insist on the convening of an extraordinary general meeting. He had to face the fact that the two sides had already closed the deal.

Nearly a year has passed since this incident, and as far as I know, the relevant regulations have not yet been promulgated, and I hope that the Hong Kong government will implement this regulation as soon as possible to prevent such things from happening again.

At that time, the tender offer document issued by Wardleys described Jianing as:

…… A wholly-owned subsidiary of Carrian Nominee Limited, the entire share capital of which is actually held by Mr. Chan Chung Ching and his family members. Mr. Chan Song Ching is a qualified civil engineer with 11 years of experience in the construction industry...... Jianing Group is seeking suitable real estate investment projects in Hong Kong, whether in the form of property development, sales or investment holdings, and Jianing Group has ...... Accumulated a considerable Hong Kong property portfolio. Jianing Group is also involved in aviation leasing, tourism, building materials trading, hotel operation and management......

By the end of March this year, Chen Songqing had regained control of Meihan Company, and Jianing Group held about 75% of the issued share capital of Meihan Company, appointing Wu Kaili as chairman of the board of directors and He Guiquan as executive director.

The Asian Wall Street Journal of February 20, 1980 had the following foresight comment on the acquisition of Jianing:

Jianing did not explain why it needed to buy a stake in Meihan in the stock market. But securities analysts believe that the benefits include the ability to buy assets of other companies by issuing shares. ”

In the process of acquiring Meihan, Chen Songqing completed the acquisition of Golden Gate Building.

In December 1979, I heard that someone wanted to buy the Golden Gate Building, at first it was to buy the whole building, but I refused, and later, the buyer wanted to be able to buy most of the floors, because the price was right, the Golden Gate Construction Company sold the 5-30 floors of the Golden Gate Building, a total of 26 floors of office buildings, to Chen Songqing's holding Jianing Company for 700 million Hong Kong dollars, and the Golden Gate Construction Company retained the naming rights of the Golden Gate Building.

To be honest, at that time, I didn't know what kind of company Jianing was, but the buyer made a reasonable bid, and my company, Gammon Construction, made this deal with Jianing.

After the news of the acquisition of the Golden Gate Building broke, Jianing Group, which had been "unknown", became "famous overnight" and became the hottest topic in Hong Kong's investment circles and media.

Later, I heard that the reason why the news of Jianing's acquisition of the Golden Gate Building was so shocking was that in addition to the reputation of the seller, there was also the purchase price of nearly 700 million yuan offered by Jianing, which was also an unprecedented "sky-high price" in the real estate transaction at that time.

In the face of this sudden real estate "dark horse", the whole Hong Kong is speculating about what is going on.

Who is Chen Songqing, the real powerful person behind "Jianing"?

As for the source of funding for the acquisition, some say that it was financed by the wife of Philippine President Ferdinand Marcos, others say that it came from the top of Indonesian politics, and some say that it was Singapore or Malaysia.

The main interest of the media was the unusual emergence of Jianing as a new force in the real estate industry, especially since the Golden Gate Building deal was completed at about the same time as the Meihan deal.

The media and investors in Hong Kong were particularly impressed by the "abundant capital" of this "dark horse".

For example, after receiving the investigation request from the Securities Regulatory Commissioner, Chen Songqinghe's Deacons (Deacons, Jianing's legal counsel) of Deacons, after receiving this kind of market rumors, not only did Jianing "add fuel to the fire", for example, after receiving the investigation request from the Securities Regulatory Commissioner, Chen Songqinghe's Deacons (Jianing's legal counsel) Moville? Melville Ives went to the SFC on January 14, and Mr. Chen said that Jianing was owned by him and his large family in Singapore, Malaysia, the Philippines and Indonesia, that he claimed to be originally from Fujian Province and had close ties to Teochew, and that Jianing's deep pockets came from US dollars in the New York market, with a 15-year credit term of 9% per annum.

The myth began, and everyone invisibly began to join the team of weaving the magnificent dream mansion.

According to reliable sources, in December 1979, U-Ming Marine Finance had borrowed $140 million from Extrawin. Neither the media nor the regulators knew about this, and Chen Songqing and Jianing did not announce the news.

Separately, Chen's other company, Plessey, has secured another $152 million loan for a "real estate development project," which is enough to cover the transaction costs of the Meihan acquisition and the Metropolis Bank Building.

U-Ming Marine Finance privately agreed not to register the collateral held for lending to Extrawin, which allowed Chen Songqing to show the loan money to the outside world as his own funds, thus giving the entire media and investment community the impression of "strong capital" and "outstanding credit".

There is also a fact that I have to inform the small shareholders who have invested in the purchase of shares of Jianing Real Estate Company, Chen Songqing and his companies have been increasing their holdings of this company's shares in the past few months, although they have made disclosures, many investors have not paid attention to these at all, and only saw the company's stock price continue to rise.

Chen Songqing's previous series of "successes" have shown investors and the market that he is capable of mobilizing large sums of money, and some financial media in Hong Kong have begun to be happy to report his story and enthusiastically look forward to bigger events.

I have to say that there are a lot of newspapers in Hong Kong, and there are some good critics, but the overall level of financial journalism is poor, and many newspapers and periodicals just copy the articles of their competitors...... (To be continued.) )