Chapter 640 Acquisition of Costco
Speaking of Larry Fink, the founder of BlackRock Group, he is a Jew born in California. After obtaining an MBA degree from the University of California, Larry Fink’s In his first job, he entered First Boston Bank, a well-known investment bank.
While at First Boston Bank, Larry Fink created the mortgage-backed mortgage bond (MBS), a new financial product, which laid the foundation for subsequent financial innovations - yes, it triggered this time and time again The CDS of the loan crisis is a type of MBS, which was originally invented by Larry Fink...
In 1988, Larry Fink joined Schwarzman, the founder of the Blackstone Group, to create Blackstone Financial Management company, which later became BlackRock.
However, as the company developed, differences between Blackstone and BlackRock gradually emerged.
In the end, Schwarzman cleared its cooperation with BlackRock for $240 million.
Since then, BlackRock has made great progress under the leadership of Larry Fink.
In fact, BlackRock Group also seized the opportunity during this subprime mortgage crisis and achieved explosive development.
Starting from Bear Stearns to American International Group (AIG), BlackRock helped these companies, as well as the U.S. Treasury Department and the Federal Reserve, deal with the "toxic" assets on the books of these companies, analyze and analyze them. liquidation.
The reason why they were able to obtain this "big business" was not only that the BlackRock Group led by Larry Fink had deep research on this, but more importantly, their "Aladdin" system.
"Aladdin" stands for "Assets, Liabilities, Debt and Derivatives Investment Network" and is an electronic platform with powerful data processing and analysis capabilities.
The platform was launched in 1988 and was initially used internally by BlackRock only.
Later, BlackRock discovered that there was huge market demand for this product and began selling it externally in 1999.
During this subprime mortgage crisis, BlackRock used the "Aladdin" platform to effectively avoid risks and make profits, which was in sharp contrast to the heavy losses and even bankruptcy of Wall Street investment banks such as Lehman Brothers.
And during this period, BlackRock used the "Aladdin" platform to quickly complete asset status analysis, formulate non-performing asset disposal plans, and also provide services to the U.S. Department of the Treasury, the Federal Reserve, and Wall Street giants such as JPMorgan Chase and American International Group. Provided key consulting services to the sovereign funds of Japan, Norway, Li Jiapo and other countries, and the results have been widely recognized.
Barron knew that during the subsequent European debt crisis in 2009, the European Central Bank, the Irish and Greek governments all began to use "Aladdin" to deal with the crisis.
This system has been widely adopted since then, and even "competitors" of BlackRock such as Vanguard Group, Blackstone Fund, and State Street Group have to purchase and use it. It is called the "basic platform" in the financial field. ”…
After this, BlackRock Group will receive It must exceed the management scale of 450 billion "non-performing" assets and obtain US$400 billion in financial credits from the U.S. government to resolve larger-scale non-performing assets. In a few years, the assets under management of this group will reach 10 trillion. US dollar, becoming the world's largest asset management group.
It can be said that by that time, people’s lives will be related to this group all the time...
Although Barron has the same confidence in the DS Group, now, in Belle Before the rise of Germany Group, he could accept exchanging equity with these future top capitals to deepen "friendship".
What's more, in addition to the fact that DS Group has completely transformed into an asset management group, in the cooperation between these three parties, in addition to accepting one director from each other, DS Group will also send one director to each other. contain.
In addition, Barron has other gains.
Institutions such as Vanguard, BlackRock and State Street have agreed to sell their shares of Costco to a consortium composed of Argos Retail Group and Caesars Fund-but they The acquisition needs to be made at a premium of 35% above the current share price.
Even so, due to the decline in Costco’s stock price, its acquisition price is far lower than when Barron’s prepared to acquire Costco in June this year. After the secondary market continues to absorb Costco's shares, if the acquisition of these institutional holdings is completed, Argos Retail Group's stake in Costco will exceed 50%.
Under such circumstances, Berkshire Hathaway finally relented and was willing to sell 45 million Costco shares they held to them.
At this point, Argos Retail Group has been able to launch an overall acquisition of Costco and complete the privatization and delisting offer.
They have been planning the acquisition of Costco for a long time. After contacting the other party's management and promising to maintain the stability of the management after the acquisition and not make too many adjustments, Costco's management also preferred Acquired by Argos Retail Group.
After all, everyone can see that DS Group has deep pockets and with its support, their future development plans will be guaranteed.
Therefore, the current acquisition of Costco is only waiting for the approval of the shareholder vote and the approval of the relevant regulatory agencies in the United States.
"I heard that you are also planning to acquire the AIA Insurance Company, Your Highness the Duke."
As mentioned before, the relevant securities assets of American International Group were analyzed and liquidated by BlackRock Group, especially American International After the group was taken over by the government, BlackRock, with the support of the Treasury Department and the Federal Reserve, was deeply involved in the related assets of American International Group, so it can know some of the acquisitions of AIA by AIA Group owned by Barron. Inside, there’s nothing surprising.
“After all, they need funds to tide over the difficulties, and I am also somewhat interested in AIA.”
Barron smiled and said:
“Actually, I am interested in those 'Distressed assets' are also very interesting, Mr. Fink, but unfortunately, Paulson and the others will not leave this kind of thing to us..."
"For these, we are more professional. This is not an easy task..."
Well, Barron just said this casually. After all, DS Group is a British capital and can intervene in the acquisition of some assets. , it already has too many advantages compared to China Capital.
As for the "preferential treatment" of local capital, I can only think about it...
Of course, he also has an advantage over Wall Street capital now, and that is the tycoons in the Middle East trust.
Previously, Badr, the president of the Kuwait Investment Authority, once represented several sovereign wealth funds, hoping to increase investment in funds under the DS Group. The reason was that the money they invested in Wall Street was lost during the subprime mortgage crisis. It can be said that he was tricked.
Originally, Barron didn't care at first. He was not short of funds now, but then he thought that if he didn't want it, the money would inevitably be invested in SoftBank, so this matter has been in contact.
If there was a sharing type like the Global Industrial Investment Fund Phase I, Barron’s originally didn’t want to continue this form, not to mention that the Kuwait Investment Authority and the Saudi Public Investment Fund had already withdrawn their funds in the GII Fund Phase I. , the remaining funds of his own were merged into the second phase of the fund.
After the subprime mortgage crisis, these tycoon countries in the Middle East also want to seek stability, so they invested in the second phase of the GII Fund in the form of fixed income... Well, with the dissolution of the first phase, now There is no one or two phases, only the overall GII fund.
The first batch of sovereign wealth funds in the Middle East invested a total of US$10 billion, and will continue to expand their investments in the future - they will slowly withdraw their investments in other places...mainly in the United States, and then invest again GII Fund.
(End of this chapter)