Chapter 551 Investing in Berkshire

Chapter 551 Investing in Berkshire

Chapter 551 Investing in Berkshire
Limited by the time limit of the US Aviation Administration, the plane flew in the air for more than an hour before returning to New York International Airport.

After experiencing the air flight and seeing the interior decoration, Yang Wendong was basically satisfied with his new aircraft. Perhaps there was really nothing to compare it with in this era. In terms of luxury, it was even better than his own private yacht.

After the flight is confirmed, it’s time to get down to business. It’s impossible to come to the United States just for your own flight.

On December 12, Yang Wendong came to an office on Wall Street:
Lin Youqi introduced with a smile: "Mr. Yang, Mr. Fang, this is the office I found for Changxing Financial Company in New York, USA. The area is about 3000 square feet. Considering the usage of offices near Wall Street, it can accommodate 30-50 people."

"Well, the scenery here is nice. We can actually see the Statue of Liberty directly." Yang Wendong came to the floor-to-ceiling window, looked at the figure in the sunlight in the distance, and said with satisfaction.

Lin Youqi said: "This is also because financial companies need sufficient proof of strength. The better the location of the lease, the more it symbolizes strength. In the future, we will also cooperate with many large financial companies or banks.

In addition, the World Trade Center will be completed in a few years. I want to communicate with them and prepare to rent half a floor. At that time, our strength will be even stronger. "

High-end service industries such as finance, legal affairs, accounting and even travel companies need to rent or own properties in prime locations, so that many customers can feel more at ease and be willing to spend more money.
The central locations of many large cities are leased to such companies, such as New York and Hong Kong. Otherwise, ordinary manufacturing industries would have no need to choose to build their headquarters in the city.

"World Trade Center?" Yang Wendong turned his head and saw two half-built buildings. Although they had not yet been topped off, one could tell how grand the two buildings were from their area.

Lin Youqing added: "The World Trade Center Center is expected to be completed in early 1973. Many companies are vying for this location now. If we want it, we still have to book it early."

"Okay, let's make a reservation." Yang Wendong didn't think much about it; that thing was still a long way off, there was no need to be paranoid, he could just change seats when the time was right.

After chatting for a while in the office, several people officially got into the topic. Yang Wendong asked: "It's been a month since the US stock market crash began. How much stock has Berkshire Hathaway acquired?"

In November 1969, the U.S. experienced a stock market crash that occurs once every ten years, and stocks of various companies plummeted.
Yang Wendong has also been waiting for this day for a long time, but his goal is not to buy at the bottom, but to choose only one Berkshire Hathaway company, that is, for Buffett's core company, a miracle company with a global single share value of more than $10 in the future;

As for the others, there may be some with great potential, but Yang Wendong is not interested in investing in them, because the potential of these companies may not be as good as that of Hong Kong real estate or even Japanese real estate. In addition, there will be too much volatility in the next few decades, and history has changed a lot, so there is no need to take risks;
As for Buffett, his ability is undoubtedly beyond doubt. Even if history changes, his ability is enough to allow him to choose more accurate stock investments.

Lin Youqi replied, "Mr. Yang, I have been buying a large number of Berkshire Hathaway shares since the stock market crash last month. Now my stake is approaching 4.9%. According to US law, once our share exceeds 5%, it needs to be announced. Mr. Yang, please confirm this."

"For the textile industry, does the US government have any restrictions on foreign shareholding, especially for large companies like this?" Yang Wendong asked.

The United States has restrictions on foreign investment in technology companies, but generally does not care about traditional companies. After all, it is the Americans who advocate free trade and free market principles. This makes it easier for American capital to control large companies in other countries. Even in the future, South Korean electronics and automobiles will counterattack Japan because South Korean conglomerates are willing to give more than half of their equity to Wall Street, while Japanese conglomerates are unwilling to do so.

However, it is hard to say what will happen to particularly large American companies when they encounter large foreign investments. The U.S. Department of Commerce may intervene.

Lin Youqi replied: "Generally speaking, if it involves a large factory with tens of thousands of employees, the U.S. Department of Commerce may ask about it, but if it is just an investment, not management participation, then it should be fine."

“Okay then, let’s announce the news and continue with the acquisition after the announcement. If the U.S. Department of Commerce sends a letter, we can just respond normally. Anyway, we are not pursuing controlling stakes, just investing.” Yang Wendong nodded and said.

Lin Youqi asked again: "What is our ultimate goal? Because this requires cooperation with Citibank, and Citibank also wants to know our purpose. They even want to act as a middleman and let us directly raise funds from Berkshire Hathaway. This will benefit both parties."

Yang Wendong shook his head and said, "Let's set it at 9.9% first and see what Berkshire Hathaway thinks when the time comes."

This investment is essentially just to get some benefits from following Buffett, but at this time Buffett only holds a little over 20% of the shares. If I invest too much, and it makes him leave and change to a shell company, I will lose money.

"Okay, I'll arrange to continue to increase the stock." Lin Youcheng agreed. They basically had no doubts about the boss's financial requirements, because the boss had almost never missed a case in his investment over the years.

On December 12, Citibank of the United States officially announced that its client, Hong Kong Changxing Financial Corporation's U.S. office, had successfully acquired 19% of Berkshire Hathaway's shares, and would continue to increase capital until the shares reached 5%;

On the other hand, Changxing Financial's New York office also formally sent two official notification letters, one to the U.S. Securities and Exchange Commission and the other to the board of directors of Berkshire Hathaway, informing them of the news of their investment.

Although Berkshire is a large company, its main business, the textile industry, has long been considered a sunset industry. Therefore, this incident did not cause much fluctuation in the stock market. Outsiders did not care at all. Only some shareholders who held the company's shares took the opportunity to unload some of their shares, and even the stock price did not fluctuate much.

The U.S. Securities and Exchange Commission has no objection to a foreign investor with a low market value. In fact, they still welcome foreign investment in America's sunset industries.

At Berkshire Hathaway, a group of board members are having a meeting. After all, there is one more shareholder, who is from abroad. This is a big deal for them. Sitting at the top of the board is a young man with brown hair who looks to be in his thirties or forties. He is Warren Buffett, the current major shareholder of Berkshire Hathaway.

"Mr. Buffett, what do you think about this?" asked David Joseph, CEO of Berkshire Hathaway.

Buffett looked at the notice in his hand, also very puzzled, and asked: "Have you contacted this Mr. Yang?"

David Joseph said, "Not yet, but there is their company's phone number on the notice, so you can contact them at any time. Mr. Yang is currently in New York, but I heard he will return to Hong Kong before Christmas."

Buffett thought for a moment and said, "Then wait for two days. I have arranged for someone to go to Hong Kong to check his information. I will make an appointment with him after everything is confirmed."

"Okay, then I'll ask him to come to my company on the 22nd. After all, he is a major shareholder. Even if he doesn't participate in the operations, we still need to meet." David Joseph said.

The US government has no restrictions on foreign investment in the shares of companies in ordinary industries, so foreign investors have corresponding rights to the shares, unless they voluntarily give up.

Perhaps the management can use some methods to prevent the other party from participating in the board of directors or interfering in the company's operations, but the other party's shares are a symbol of rights. As long as a shareholders' meeting is held, no one can deprive the voting rights. The higher the shares, the stronger the deterrent in this regard.

In Europe and the United States, companies with decades or even hundreds of years of history have very dispersed shares. Let alone 5%, sometimes even 1% is considered a major shareholder. This is why many managers don't care about shareholders as long as they don't make big mistakes.

Berkshire is the only strange case. Before, Buffett made a large-scale shareholding acquisition, and now a foreign capital is acquiring shares. They themselves don’t know why their company is so attractive. With one more major shareholder, the management can also use it to check and balance the largest shareholder, Buffett.

Therefore, under normal circumstances, there is no conflict of interest, and the management naturally wants to maintain good relations with such major shareholders. No one wants to make enemies easily.

Buffett could only agree: "Okay, I'll meet him then."

He was also puzzled. He acquired Berkshire to increase his influence in the United States and use this listed company to make various investments and facilitate some financial operations.
But what is the purpose of a foreign capital doing this? The textile industry in the United States basically has no future. Although he wants to change this, he knows it is difficult.
Could it be that the Hong Kong capital invested in Berkshire just for the textile industry? Because in terms of textile technology, patents, talents, and markets, Berkshire still has some resources; and Hong Kong is also one of the regions with a large number of textile exports.
From this perspective, it does make sense.

At the Waldorf Astoria Hotel in New York, Yang Wendong also received a call from Berkshire, and smiled at the people around him: "Let's go, take our own plane to Omaha."

Berkshire Hathaway's headquarters is in Omaha, Nebraska, USA. This was his first visit to this place.

PS: Please give me a monthly ticket
(End of this chapter)