Gree said that the decision-making power of Zhuhai Yu Xiu is divided into three pillars, but there is an additional provision in the mixed reform plan: "Of the three directors nominated by Zhuhai Mingjun for listed companies, at least two should be recognized by Gezhen Investment".
The Shenzhen Stock Exchange is also very puzzled: "Can it be considered that Gezhen Investment actually has two-thirds of the voting rights in Zhuhai Yu Xiu?" Gree's answer is a proverb: "(The above clause) is the arrangement of the board seats of listed companies, which has nothing to do with the basic rights of the three shareholders of Zhuhai Yu Xiu to nominate directors of Zhuhai Yu Xiu."
As we all know, one of Yu Xiu's most important rights in Zhuhai is Gree Electric's right to nominate directors. If the "tripartite confrontation" cannot be realized in this right, then the so-called tripartite confrontation in Yu Xiu, Zhuhai is only superficial.
In other words, Gao Jie only got the face of "three pillars", but lost the "lining". This "foot" of Gao Ling is obviously weaker than that of Dong Mingzhu.
According to this explanation, we also know that Gao Ling originally held two of the three directors' seats in Yu Xiu, Zhuhai, but gave up one seat for Dong Mingzhu, thus losing the majority. From the majority of seats, to the "three pillars" and finally to the last leg, it is not complete, and Gao Xian is finally making way for Dong Mingzhu. This is really the weakest PE in the history of buyout.
Taking Gree as an example, the media dubbed it "historic" and "milestone". These comments are not excessive. Buyout has never really taken root in China, and PE Gao Ling, who is engaged in leveraged mergers and acquisitions in China, is not only the "best one", but also almost the "only one". From Belle to Gree, Gao Xian took China's lever M&A to a new height by his own efforts.
But the Gree case is not a typical acquisition case. Focusing on Zhuhai Mingjun, who holds 65,438+05% shares of Gree Electric, Gao Xian has to share the cake with two partners-Dong Mingzhu and Cao. I don't want to go into details about the detailed plan of Gree's mixed reform, but simply list the rights that Gao Ling finally reserves.
1 in. Zhuhai Mingjun and Gezhen have invested in 1 1% in Dong Mingzhu, Zhuhai has 3.6% in Cao, and Gaolin needs to raise the remaining 85%. It is reported that Dong Mingzhu's share is free of fund management fees.
2. Zhuhai Mingjun's GP is Zhuhai Xianying, which is also a limited partnership structure. Gao Lin has 24% limited partner shares, Gezhen Investment has 20% limited partner shares and Cao has 5% limited partner shares. The remaining 5 1% is held by Yu Xiu, Zhuhai, Guangdong.
3. In Zhuhai, Gao Ling's share is 49%, Gezhen's investment is 465,438+0%, and Cao's investment is 65,438+00%.
This is a line, mainly the distribution of income rights of famous counties in Zhuhai. In the end, when Gaoling raised 85% of the funds of famous counties in Zhuhai, it only got about half of GP income rights.
The other is the distribution of decision-making power. The trading plan says Gree has no actual controller. In view of this, the Exchange just sent an inquiry letter, and Gree gave a reply on June 65438+1October 17. According to Gree's reply, the distribution of decision-making power has been very clear.
1. The board of directors of Zhuhai has three seats, which are respectively nominated by Gao Ling, Cao and Ge Zhen.
2. Zhuhai Mingjun can nominate three seats on Gree's board of directors. This nomination right is equally distributed among Gaoling, Cao and Gezhen Investment, each holding one seat. However, at least one of Gao Ling and Cao's nominations must be recognized by Gezhen Investment.
According to this structure, Gao Yan's role in Gree is basically a major shareholder with only capital contribution, and his decision-making power is minimal. Moreover, this structure has been strictly cured. Gao Wei promised in writing that Gree will remain in a state of no real controller and will not seek control in the future.
Looking at buyouts at home and abroad, such a weak PE is rare. For PE, the final plan of Gree mixed reform is an "unequal treaty" that can go down in history. As soon as the plan came out, PE people commented one after another: if entrepreneurs ask for this kind of talk in the future, it will be troublesome.
We can also see Gao Xian's openness and generosity from the arrangement of students' rights in Cao Jun. Cao Shengjun invested only 3.6% in Zhuhai County, but he got 10% of GP income right, which is completely equivalent to Gao Lin's decision-making right.
Gao Lin's early battle for fame was to invest in Tencent, and he had a deep friendship with Ma. Tencent used investment to clear the way, from closed to open. Ma claimed that Tencent only left half of its life, "giving the other half to its partners".
On the other hand, PE investment, in fact, "half-life" is the normal state, and the other half-life is always in the hands of the other party, which is an eternal problem of minority equity investment. However, in the Gree case, it is somewhat surprising that Gao Yan still has to hand over the rest of his life after investing 20 billion yuan to become a major shareholder.
Although in terms of capital and fame, Gaoling is already the most powerful PE in China. Zhang Lei has always faced entrepreneurs with a low-key attitude, repeatedly saying "We are icing on the cake, not subversion", "Let entrepreneurs sit in the C position" and "We can't compare with the accumulation of entrepreneurs for decades".
"Let entrepreneurs sit in the C position, which is the first principle that Gaochun Capital adheres to." At the Wuzhen Internet Conference in June 20 19, Zhang Lei talked about the "digital transformation" of enterprises on the stage. At that time, Gao Xian was in the final negotiations with Dong Mingzhu. Zhang Lei didn't mention Gree in his speech, but his words were quickly interpreted by the media as a statement to Dong Mingzhu.
Shortly after Zhang Lei finished his "C position" theory, the case of Gree mixed reform was settled. Dong Mingzhu did sit on the "C".
Gao Xian wants Dong Mingzhu to sit in the C position, which is expected to ensure the stability of Dong Mingzhu's team, restrain the management and send an equity incentive package. However, Gao Yan raised his hands and completely surrendered the initiative, which far exceeded the expectations of the outside world. After all, in Belle's case, Zhang Lei also said that entrepreneurs should take the C position, but the leading power is still firmly in their own hands.
In 2065.438+07, nearly 20% of Gaoying Phase II RMB fund with a total scale of 654.38+05 billion yuan invested in Gree. This is far from enough. The remaining 654.38+0.72 billion yuan comes from overseas, which is also a lot of money for Gao Lin-in 2065.438+08, Gao Lin raised $654.38+0.06 billion, which is an Asian record, and 654.38+0.72 billion yuan is about 23% of it.
These figures alone are enough to show how important this case is to Gao Ling, not to mention its powerful demonstration effect. And such an unmistakable case, completely to Dong Mingzhu.
After the result of winning the bid was announced, public opinion was envious at first, but after the final plan was released, it was more of a joke: Gao Xian originally worked for Dong Mingzhu. This precedent is not what PE colleagues want. Isn't it a little big for Gao Yan to win Gree?
From JD.COM to Belle, Gao Ling has been "good at" causing controversy for many years. Zhang Lei is also very clear about this. After the acquisition of Belle, Zhang Lei himself joked: "Others say that this will be the Waterloo of Gaoling."
Zhang Lei likes to say the word "keep the right and use the strange", and he does not hesitate to gamble. He publicly said that Tencent, which had a heavy position in that year, "had gambling elements." Investment is the art of risk, and there is no 100% certainty. For Gao Ling, the Gree case was not only worth gambling, but even had to gamble.
One year before the Gree case, Gao Lin raised the latest fund of $654.38+006 billion, setting a record for the fundraising scale of a single fund in the entire Asian PE industry, and Lin's total assets management scale reached $60 billion.
The fact that Gaoling is already the largest PE organization in China explains why Gaoling must win Gree, even if it accepts such harsh conditions. Because scale is pressure, super funds have to invest in super cases. And how much Gree can China have? After this village, it is almost impossible for Gao Ling to find a similar store.
Not long ago, people used similar words to describe Sun Zhengyi and his vision fund. The IPO failure and valuation collapse of Wework in 20 19 brought an earthquake to the whole venture capital industry, even to China on the other side of the Pacific Ocean. If you ask what is the most shocking event of 20 19, it is estimated that most investors will blurt out Wework.
From 20 17 to now, Sun Zhengyi has basically taken Wework's financing, with an investment of more than 6 billion US dollars. After Wework IPO lost, Sun Zhengyi still chose to invest a lot of money in blood transfusion, increasing Softbank's shareholding ratio to 80%. This also directly led to Softbank's historical loss of billions of dollars in 20 19.
Back to 20 17, why did Softbank Vision Fund choose Wework? This question can be answered by another question: If you don't vote for the world's largest unicorn, what will the world's largest venture capital foundation vote for?
In terms of fund scale, Softbank Vision Fund ranks first in the world, while Gaoying has already ranked first in Asia. Zhang Lei is the closest person to his son in China, and the scale is the "curse" that Superfund has to face. Of course, except for the scale, Gaoling and Softbank have nothing in common. It is far-fetched to call Gao Ying China's Softbank or Zhang Lei China's Masayoshi Son.
In addition to the super-large fund of $654.38+006 billion, it is impressive that the scale has doubled. As we all know, Zhang Lei founded Gaolin in 2005 with $20 million donated by Yale University. By 20 10, the management scale of Gaolin has grown to $2.5 billion. In 20 14 years, the figure is1600 million dollars, in 20 17 years it is 30 billion dollars, and in 20 19 years it is 60 billion dollars.
What drives the growth of top management scale is a super-large case. Belle's M&A case of HK$ 53 1 000 million in 20 17 directly led Gao Yan to raise a super fund of US$ 0 106 billion in 20 19, and then Gao Yan became the major shareholder of Gree with a market value of 400 billion yuan in 20 19.
This spiral of "bigger case-bigger fund" is somewhat abrupt in the private equity market, which is dominated by domestic investment in the growth period. Although it is not uncommon for star projects to be funded, in general, VC funds win by investment quantity and hit rate, not by case-driven.
But in leveraged mergers and acquisitions, this is a common spiral. A typical example is KKR, the pioneer of the leveraged M&A model in 1980s. Starting from 1976,100,000 USD, 1987 raised 5.6 billion USD.
But this spiral came to an abrupt end. Reynolds-Na Beske didn't make any money for KKR. After this case, KKR entered a painful contraction period, and a bigger case than Reynolds-Na Beske will not appear until twenty years later.
The Gree case made Zhang Lei's name "out of the circle", just like Henry kravis in those days, which can be said to be known to all women and children. But PE is not king. Just like KKR, the spiral of "bigger case-bigger fund" of Gaoling Capital will stop one day.
Of course, simple analogy always loses a lot of details and is seriously distorted. Thirty years have passed, and leveraged mergers and acquisitions have already changed. Gao Ling has never touched leverage for dozens of times, and China has no junk bonds. The management scale of Gaoling will stop doubling one day, but not in KKR way.
Lever M&A has its own limitations in China.
Unlike the excitement of buying Belle, Gao Yan was particularly low-key in the Gree case.
Including Zhang Lei, Gao Xian's voice in Belle incident was quite positive. Investment logic, ideas, and post-merger operations, including spin-off, have been repeatedly discussed by Gao Xian.
But so far, although the outside world has been boiling against the sky, Gree's share price has soared, and the interpretation of Gao Ling's intentions has piled up more than three meters, but Gao Ling still has no words.
Dong Mingzhu on the other side doesn't have so much scruples. At an open forum at the end of 20 19, Dong Mingzhu was not surprised when asked what cooperation and collaboration Gree would have with the new shareholder Gaoying Capital in the future. This is a must-ask standard questions, but Dong Mingzhu's answer sounds a little unprovoked. She said, "At least I don't see it now." Then she added: "If one capital can solve the problems of enterprises, how can we see that so many people engaged in capital are thundering today?"
The question about Gao Yan's capital seems to arouse Dong Mingzhu's cynicism, perhaps because it implies that Gree's current management is not good enough. Dong Mingzhu is one of the top entrepreneurs in China, and Fortune magazine calls her one of the most influential women in China. She really has no reason to think highly of Gaoling Capital like the outside world.
Besides, it's no secret that Dong Mingzhu doesn't like capital. In Dong Mingzhu's remarks, words such as "barbarian" and "disrupting industry" are always associated with capital. If we let go of the cruel words, we will spare no effort to use all resources against the "barbarians." During the Gree mixed reform case, Dong Mingzhu publicly denounced the barbarians for many times. Although the bidders are PE institutions such as Gaoying and Houpu, the barbarians targeting Vanke and Gree have long since disappeared.
In the end, Dong Mingzhu tamed the capital as he wished and won a great victory in the negotiations with Gaoying Capital. Capital does not threaten Dong Mingzhu, but is firmly controlled by Dong Mingzhu.
So will Gree's final power structure satisfy Gao Ling? We don't know. But in any case, this is a compromise that must be made. Objectively speaking, there is no PE institution in China that can be "on an equal footing" with Dong Mingzhu, nor does Gao Shenling, which is determined by the general environment. More importantly, Gao Ling has been trying to create the image of an "entrepreneur friend", carefully avoiding being labeled as "greedy" and "arrogant" like KKR. This is the art of balancing on a tightrope, and Gao Ling needs to adapt again.
In Belle's case, Belle's management looked up at Gao Xian: Belle was in trouble at that time, and Gao Xian was a savior. After the merger, Deng Yao, the 80-year-old founder of Belle, cashed in, and Zhang Lei personally became the chairman of Belle, and became addicted to "capital entrepreneurs". Zhang Lei said that he spent a lot of time studying shoes, thinking about digital transformation, and even fell in love with shopping, just to observe how women buy shoes. The most important step is to split up and go public independently. This is a strategy formulated by Gao Yan a long time ago, which has been quickly implemented and achieved satisfactory results. At present, the market value of Tao Bo has reached HK$ 69 billion, which has far exceeded the total market value before Belle's delisting, ensuring the lower income limit of Belle's merger.
But Gree's situation is completely different. On the one hand, Gree's case is more important than Belle's, and Gao Ling has invested more. Gree is a stepping stone to a bigger fund and a bigger case? Or is the focus of this spiral like Reynolds-Na Beske to KKR?
On the other hand, Gao Ling's half-life is not in his own hands, but in the hands of Dong Mingzhu. The advantage is that Gao Xian got a proven excellent entrepreneur without worrying about Gree's operation. The downside is that the entrepreneur is not hostile to Gao Ling, but he doesn't admire him. Whether it is industrial empowerment or digital transformation, these proud core competencies have not got enough room for display. (Text/Tao Huidong Source/Investment Network)