Friday, July 4th.

Wang Guanxi got up very late and finished washing.

I'm a little hungry.

So I made a lunch at home, egg noodles.

Plus a pear.

Listen to music and watch the news.

[Buffett's Berkshire Hathaway company's stock price rose sharply, and its stock price broke through $135,000 per share]

$135,000 per share refers to Berkshire Hathaway's Class A shares. Of course, the Class A shares here are not A shares.

The stock price is as high as US$135,000 per share, and ordinary retail investors can't afford it.

Berkshire Hathaway owns A and B shares.

Because the company's stock price is getting higher and higher.

In the US stock market, in order to ensure that a stock has normal liquidity, when the stock is higher than a certain price, securities companies generally advise companies to split their shares.

This can ensure that its stocks remain in the range of $10~$500, making it easier for retail investors to buy.

For example: Baidu is very ten, Google is one and two, and Apple is one and seven.

After the stock split, the total number of shares issued by the company increases, and the price per share decreases accordingly, which has no impact on the market value of the entire company, but it is more convenient for retail investors to enter.

The reason why Buffett did not dismantle is that he has always adhered to the value investment. If you want to invest, you should consider it for 10 years or longer. He does not want speculators to come to Berkshire Hathaway to make quick money.

Of course, another aspect is that Buffett himself has a particularly character and will not give up his principles because of the fraud of brokers and other small shareholders. Buffett himself promised:                                                                                                         �

As a result, Berkshire Hathaway's stock price became higher and higher. Later, two points caused Buffett and the company's board of directors to change their minds:

1. Some shareholders want to use gift to give Berkshire Hathaway shares to their relatives and friends to legally avoid taxes. However, the tax exemption limit for gift is $10,000, while Berkshire Hathaway's single share has exceeded this limit.

2. Some mutual funds have developed a set of ways to buy and trade a small portion of Berkshire Hathaway's stock. That is, they can bypass Berkshire Hathaway's unit price to allow more small retail investors to come in to speculate.

Based on the above two points and Lao Ba’s previous commitment to not split the shares, the company gave the solution: the original shares are renamed Class A shares and the newly issued Class B shares.

When Class B shares were issued in 1996, the price was 1/30 of a.

One Berkshire A-share can be converted into 30 B-shares, but Class B-shares cannot be converted into Class A-shares.

When talking about Berkshire Hathaway, Wang Guanxi thought of the insurance industry, which is a very profitable industry. Buffett started out as an insurance business and then became a diversified investment group.

If you own a huge insurance company, you can provide a steady stream of cash flow.

Wang Guanxi plans to acquire several insurance companies in the future to facilitate future layout.

At this time, his phone suddenly rang, and Zhang Dexi, chairman of Catal Auto Insurance, called him.

Connect.

"Old Zhang, what's the matter?" Wang Guanxi knew that Zhang Dexi had lost a lot of money after he broke the stock twice and was short of money. He mentioned that he had jointly established a life insurance company with Zhang Dexi, but was rejected.

Zhang Dexi asked tentatively: "Guanxi, are you interested in buying some bonds from American companies? How about I give you a 20% discount?"

"Bonds of American companies?" Wang Guanxi smiled. He would not want to pay for 20% off now. Many bond combinations are toxic.

Zhang Dexi smiled and said, "Yes, are you interested?"

Wang Guanxi said bluntly: "I am not interested in American corporate bonds. Lao Zhang, are you short of money?"

"Oh, yes, I have lost a lot of money in my personal life recently." Zhang Dexi sighed: "I still owe HSBC Securities debts."

"Are you interested in investing in my Catal Insurance Company?"

Wang Guanxi thought for a while: "I'm not interested in investing in it, but I want to directly acquire your Catal Auto Insurance."

Youde still has a set of insurance business in this insurance business. Catalan Auto Insurance will be successfully listed in the future. In 2015, Catalan Auto Insurance had the highest market value, reaching HK$4 billion.

This shows that Zhang Youde is very capable in the insurance business.

"Acquisition?" Zhang Dexi took a breath. Unexpectedly, Wang Guanxi had such a big appetite. However, he is short of money now, and Catalan Insurance's performance this year is quite bad, because he holds a lot of stocks and his assets are shrinking and he cannot make much net profit.

Wang Guanxi: "Yes, it's acquisition"

"Old Zhang, are you interested in selling the company? Anyway, insurance business is not easy to do this year, so you might as well just sell it. The price is right. I will arrange for the legal specialist to review the assets and give you a suitable price."

"I think about it." Zhang Dexi pondered for a long time on the phone and didn't want to sell it. The insurance company was his golden egg. He really didn't want to sell it, but now HSBC Securities is collecting debts, so he has to sell it.

"You will arrange someone to check the asset and debt statement tomorrow, and we will talk about it when the time comes."

"Today"

"I'm still in Macau, I'll go back tomorrow."

"Okay!" After the call, Wang Guanxi called his lawyer group.

The next day, July 5th, Saturday.

Wang Guanxi took Xue Feng and Matsuba Hamada to Queen's Avenue and New Era Square.

Zhang Dexi and several executives were here to wait for Wang Guanxi.

Mu Honglie, Chen Xuezhen, Wei Weicheng, and Huang Shaokai are all senior executives in the company. They are veterans who have made Catal Auto Insurance with Zhang Youde, and they have certain dividends every year.

"Guanxi, you are here." Zhang Dexi greeted him warmly.

The other small shareholders are also very polite.

"Old Zhang, let's go and see the financial situation." Wang Guanxi smiled and said, "If it's suitable, I'll buy it today."

"Okay, please!"

Everyone talked as they walked and said that the four veterans of Wang Guanxi only received dividends and had no equity, which means that Zhang Youde held 100% of the shares.

Catalan Auto Insurance is mainly engaged in auto insurance underwriting business.

Including third-party automobile insurance and comprehensive insurance, the main customers are taxi and public minibus owners in Hong Kong.

Currently, the company has three business departments: taxi department, public minibus department and other automobile departments.

In 2007, the company's net profit was HK$12 million, so it's hard to say this year.

The company's current liabilities are 500 million yuan. Of course, this liability does not refer to bank loans in terms of asset debt.

For example, bank deposits are bank debts. For example, if the bank deposits are 100 billion, then its debts to deposit customers are 100 billion.

The liabilities of insurance companies are also aimed at insurance customers. If the customer who bought insurance suddenly breaks up, the insurance company will have to pay for it.

The total assets of Catalan Auto Insurance are now HK$550 million.

The net assets are HK$50 million.

Catalan Auto Insurance holds many stocks of listed companies and some corporate bonds, which are now losing money, and its total assets have been reduced to HK$700 million in the original amount of HK$550 million.

Usually the market value of listed companies is higher than that of net assets. Usually the market value of listed companies is twice that of net assets, and of course there are more.

It is usually related to the company's future prospects, dividends, etc. In short, many factors are related.

For example, in the next 2020, Tesla Automobile's net assets will be US$21.679 billion, but its market value will be US$643.7 billion, which is 30 times its net assets!

Of course, this Catalan auto insurance is naturally not comparable to Tesla.

Wang Guanxi said: "Old Zhang, your company is not listed, and many of the stocks you hold are losing money and your assets are shrinking. I can only value you HK$80 million."

Once the acquisition is successful, Wang Guanxi will immediately sell these assets and then exchange them for cash. As for the debt of 500 million, that is the total amount of insurance policies purchased by insurance customers. As long as the customers do not die unexpectedly and do not have a large-scale car accident, there is no need to worry.

Zhang Dexi was stunned. Wang Guanxi's price was too low. He said, "It's too low, you have to give me at least 100 million."

"According to a valuation of 2.5 times"

Wang Guanxi refused: "2.5 times the valuation is calculated? How is this possible?"

"No, it's definitely not worth that much money. When the stock price falls and the assets shrink, your assets will become negative after the stock price falls."

"I'm giving you 80 million is already very suitable. It's reasonable. Lao Zhang, don't talk big."

Zhang Dexi said firmly: "No, you have to give me 100 million."

Wang Guanxi immediately opened the stock trend chart, these BYD Electronics and BYD Auto’s stock trend charts.

"You Catal Auto Insurance bought BYD Electronics and BYD Auto's stocks. The stocks have been falling recently. I don't know what the decline will be. When the assets continue to shrink, the net assets of Catal Auto Insurance may become negative."

"I'll give you 90 million"

"I don't even bother to consider the 90 million small amount of money, so you just think about it for 2 minutes!"

Zhang Dexi immediately knelt down to Wang Guanxi with an extremely awkward expression.

tm's, 90 million is a small amount of money for you, but a big amount of money for me!

He glanced at BYD Electronics and BYD Auto's stock trend chart, and finally said: "Okay, that's 90 million!"

If the stock price of BYD Electronics and BYD Auto continues to fall, Catal Auto Insurance's assets will continue to shrink, and then Catal Auto Insurance's net assets may become truly negative.

"Okay, the deal is completed!" Then Wang Guanxi asked Xue Feng and Hamada Matsumoto to draft a contract and then sign an agreement.

Wang Guanxi's Black Shirt Group bought Catal Auto Insurance from Zhang Youde for HK$90 million.

Finally owning an insurance company. Although it is just a car insurance, it will rise in the future.
To be continued...