The next day, Xia Tian found Liang Botao and discussed the issue of issuing bonds to raise funds.

"Mr. Xia, how many bonds are you planning to issue?" Liang Botao nodded and asked.

"Hong Kong dollars of one or two hundred billion is a drop in the bucket, and it will take 30 to 50 billion to look like it." Xia Tian thought for a while and said.

One or two billion Hong Kong dollars, only two billion US dollars. Although it sounds like a lot, it will actually cost you a clean purchase of a Columbia record.

There are many places to burn money in the future in the summer, such as investing in Taiwan’s high-tech companies, expanding the viewership range of Rainbow Media, using the Tokyo real estate bubble to speculate in real estate, etc. Therefore, 200 billion US dollars are not very useful, and at least 500 billion is enough.

After hearing what Xia Tian said, Liang Botao couldn't help but take a breath.

The Hong Kong bond market started late. In the 1970s, Jardinet, Air Asia and others issued bonds in Hong Kong to raise funds. In the 1975, the Hong Kong government issued government bonds for the first time. From 1971 to 1980s, Hong Kong only issued 38 bonds in total, with a total amount of only 8.6 billion Hong Kong dollars.

In 1988, the total amount of the Hong Kong bond market was only about 10 billion Hong Kong dollars. Xia Tian wanted to raise 300 billion Hong Kong dollars in one breath, not to mention that he was just a whimsical idea, but at least he was a lion talking.

"Mr. Xia, with the current size of the Hong Kong bond market, it is absolutely impossible for you to issue 40 to 50 billion Hong Kong dollars in one go. Because the market here is not that big, even if you can issue so many bonds, the market will not be able to digest it at all and will not have the effect of raising funds." Liang Botao explained.

After hearing this, Xia Tian felt ashamed and knew that he had made a common sense mistake again. He often said in his previous life that a certain company issued bonds and raised hundreds of billions of dollars, so he subconsciously believed that issuing bonds and raised tens of billions of dollars is a very common thing. He forgot that Hong Kong is now incomparable to the mainland in his previous life.

The bond scale in the mainland in the past life was as high as 68 trillion yuan, while the bond scale in Hong Kong was only about 10 billion Hong Kong dollars at this time, which was a 108,000 miles away.

"What do you think?" Xia Tian asked again.

"My opinion is either to issue bonds in another market, such as going to the United States. The bond market there is large in size, and it is easy to digest 300 billion US dollars of bonds," Liang Botao explained. "Or it is just a small-scale, multi-batch issuance in Hong Kong. It raises 200 billion Hong Kong dollars at a time, although it is not of great use, but it is not without small compensation."

"Is it easy to issue bonds in the United States?" Xia Tian asked again.

"It's not easy." Liang Botao shook his head, "The credit rating companies in the United States are not familiar with the operations of our Hong Kong companies, and the rating standards they set are not tailor-made for us. Therefore, we were originally a company with very good credit, but they may be rated as a bad credit, which affects the issuance of bonds."

"Yes." Xia Tian heard him say this, and thought of many mainland companies that landed on Nasdaq in the United States in his previous life. Later, they began to privatize and prepare to return to China and relist on the A-share market.

For example, 360, Qunar, Jumei Youpin, etc., their reasons are that American stock investors cannot understand their company's operating model, which leads to their stock prices being seriously undervalued. Therefore, they would rather choose to be privatized and return to A-share listing.

This is true for the stock market, and I believe the bond market is the same.

"Then let's issue it in a small scale in Hong Kong." Xia Tian thought for a while, "It's okay to try the waters."

Anyway, he is not in a hurry to use money now, so it is OK to use small steps and run fast. Moreover, it is also possible to issue bonds on a small scale and multiple batches, and can operate flexibly according to the situation, which is not without benefits.

"The first batch of bonds will be issued 2 billion Hong Kong dollars first." Liang Botao asked for his consideration and said, "With your current popularity, this bond should be able to be sold."

Two billion Hong Kong dollars is already the largest batch of bonds issued in Hong Kong's history. The previous Hong Kong government issued bonds only only one billion Hong Kong dollars.

"Yeah, that's fine." Xia Tian nodded.

Two billion Hong Kong dollars is about 300 million US dollars. Although it is not too much, it is enough for him to spend a while.

"Then how many years are you going to issue and what is the interest rate?" Liang Botao asked again.

Bonds are divided into one-year, two-year, three-year, five-year or even ten-year, and different years. At that time, the bonds must be redeemed to investors and interest will be paid.

"The time will naturally be longer and better." Xia Tian smiled slightly.

Many of his investments now have not received much return. For example, Microsoft, ADOBE, Oracle, EA, Cisco, Seagate, Qualcomm, etc. But wait a few years to see, these investments will bring him extremely high returns of tens of billions of dollars. Therefore, what he lacks the most now is time, so he also wants to make a time difference when issuing bonds.

"Ten-year bonds are probably difficult to issue because there are too many variables. Generally, companies and institutions issue bonds, usually one year, two years, three years, and the longest is five years."

"Then choose the five-year period." Xia Tian said immediately when he heard this.

Five years later, Microsoft, Oracle, ADOBE, Cisco, EA and other companies should develop. By then, he will never have to worry about not having money to pay off his debts.

"Okay." Liang Botao nodded, "What do you think is appropriate for the interest rate?"

"As long as it does not exceed 10%, I can accept it." Xia Tian thought for a while.

Some projects he wants to invest in, such as Taiwan's Hi-Tech and Fusang Real Estate, can quickly see benefits and have extremely high returns.

However, there are some projects that don’t pay back that fast, such as Columbia Records. After he bought it, he didn’t know when he would be able to pay back;

For example, Blockbuster Video Video Chain Store will not only not make a profit quickly after acquisition, but will continue to invest in the summer until it develops to a certain scale, and it will not be able to obtain a generous return.

Therefore, the annual interest rate is 10% of its bottom line. If it exceeds this bottom line, it is better to issue new shares than issuing bonds.

"Don't set that high." Liang Botao heard him say, and quickly waved his hand, "Usually, the face value interest rate of a bond is one to two percent higher than the annual interest rate of a bank deposit. Only credit bonds need to borrow such a high interest rate to raise funds."

There are two types of bonds, one is mortgage bonds and the other is credit bonds.

Mortgage bonds are bonds guaranteed by corporate property. Credit bonds are bonds issued entirely on credit. Because there is no mortgage on property, investors will face more risks, so the interest rate will naturally be higher.

"Then set it to be 4% to 5%, which is a little smaller than the bank loan interest rate." Xia Tian smiled.
Chapter completed!