"Feng, your negotiations with that bank are going very smoothly. I see that the media has reported on your acquisition. Tianlai Novel WWW.⒉" Kirilenko was happy for Feng Yu's success.
"It's okay. The price I gave is already very high. At this time, there are not many people who can afford so much money and are willing to buy their bank. They don't have many choices."
Feng Yu leaned on the sand in front of the stove, warming the stove in the cold winter. What a pleasure. Fortunately, Ralph had already done the work before, and Feng Yu only had to come over and make the final decision. Being the boss was so good, he only made the final decision and didn't need to do anything else.
"As long as everything goes well, I've also contacted Lituo, but we have a strong competitor."
Are there competitors? Feng Yu remembered that in his previous life, there seemed to be rumors that Lituo was being acquired, but in the end it seemed that nothing had happened, also because of the impact of the financial crisis.
Feng Yu knocked his head: "Is it Vale or BHP? Let me guess, is it BHP?"
These two companies are currently the first and second largest iron ore companies in the world, with Lituo ranking third. Brazil's Vale accounts for more than one-third of the world's iron ore output, almost as much as BHP and Lito combined.
So basically the price of iron ore in the world is set by Vale, and they are the leader in the industry. However, Li Tuo's second headquarters is in Australia, and it has a good relationship with BHP Billiton. The two parties have also been jointly fighting against Vale.
Taking into account the monopoly factor, even if Vale wants to acquire, it will not succeed. Otherwise, if they occupy half of the world's iron ore, how can others play with it? So this competitor is BHP
Kirilenko showed admiration in his eyes. Feng Yu guessed it before he said anything.
"That's right, it's BHP Billiton. They wanted to acquire Lituo last year as a whole. The initial offer was US$150 billion, which was raised to more than US$170 billion at the beginning of this year."
"At that time, the stock prices of both companies were rising rapidly. But then came the financial crisis. The stock prices of BHP Billiton and Li Tuo were falling, and the agreement between the two parties was not finalized. Now it’s on hold again.”
"This also gives us an opportunity. If they had reached an agreement long ago, we really have no chance to acquire at this time. Moreover, because of the financial crisis, industrial expansion is also declining, such as the automobile industry, machinery industry, construction industry, etc. The decline in demand for steel has also led to lower prices for iron ore."
"Based on the current stock price, Lituo's market value is only over 100 billion U.S. dollars, and their stock has dropped by more than 40% from its peak."
Kirilenko looked happy. If calculated based on the peak market value, then they may not be able to purchase it in cash. Moreover, the economic crisis caused by the financial crisis will not last too long. The steel industry is currently at a low point, which means that the price they pay for the acquisition will never be too high.
Feng Yu raised his eyebrows, only a little over 100 billion US dollars? This price should be lower than its true value. After all, in addition to iron ore, Lituo also has a variety of other mineral resources, with excellent technology and many rich ores.
"What about the financial situation? Lituo is a listed company, right? Did they make a loss this year, and how much loss or profit is expected next year? Also check carefully to see if there is any fraud in their finances."
If the financial data is not real, then there will be errors in their analysis, which will affect their judgment and they may have to pay a lot more money.
Since the overall steel industry has declined this year, it is normal for Lituo Company to suffer losses. A loss in a certain year does not mean that the company will always lose money. After all, they still have many mineral properties, which can be regarded as real estate that maintains their value.
However, if a company selling mineral resources really loses money, it will be quite disappointing. Feng Yu will have to reconsider whether this company is worth acquiring.
"In the financial statements, they are still profitable this year. The profit amount is more than 7 billion US dollars, which belongs to their entire Lituo Group. After all, their profits were not bad in the first half of the year. Lituo Group has three major companies: British companies, Australian companies, and Canadian companies. Group companies, listed in London and Australia and New York respectively."
"They are the world's largest in the aluminum industry. To a large extent, they can influence the pricing of aluminum, which is much greater than their say in iron ore."
"According to their listing report, their turnover this year is about US$30 billion. At the beginning of the year, they planned to have a turnover of US$50 billion this year. If it were not for the drop in prices of various minerals and the drop in demand, Maybe they can actually finish it.”
"Well, correspondingly, BHP Billiton's turnover is about 40 billion U.S. dollars, and its profit is about 13 billion U.S. dollars. Vale, the leader in the iron ore industry, is in a worse situation, with a planned turnover of about 50 billion U.S. dollars. , but the turnover is only about 32 billion U.S. dollars. There is no way, the price of iron ore has dropped the most, and their profit is close to 12 billion U.S. dollars. After all, they mainly export iron ore."
"Also, the turnover of American Aluminum this year is about 30 billion U.S. dollars, and the profit is only more than 3 billion U.S. dollars. If we acquire Lituo Group, it will also be one of our competitors. But look at the profits of this company We know from the rate that their mineral reserves are too low and the cost of mining is very high, and they mainly do processing.”
“In terms of mineral reserves alone, American Aluminum is far inferior to Lituo. Lituo acquired a Canadian aluminum company last year. Due to the poor economic situation and the need to update equipment in the mines there, the mining volume decreased. , starting from 2009, Lituo will be able to dominate the aluminum industry."
Kirilenko's meaning is very clear. After acquiring Lituo Group, they will have a great say in the aluminum and iron industries. In addition to their original say in gold, nickel, copper and other minerals, they can Becoming the world's number one mining group!
After becoming the boss, they have greater maneuverability. Whether it is to squeeze out the smaller ones, take advantage of the opportunity to annex them, or increase the profits of the entire industry, it is all a matter of them.
This is the advantage of mining companies that they can still guarantee such high profits even when prices of metals and other materials have fallen sharply.
Only counting the costs of mining, transportation and maintenance, the rest is their profit. In fact, the profits of Polar Bear Mining Group this year are also good, but as a non-listed company, it does not participate in Fortune's top 500 rankings, otherwise it would definitely be included in the top 500.
But it's not the first place, Feng Yu doesn't care about it at all. After the Polar Bear Mining Group becomes the number one in the world, Fortune will not rank it, and it will not be able to cover up the glory of the Polar Bear Mining Group. At that time, it will prove that Fortune is not fair at all!
"Is Lituo's stock price still falling? Why don't we acquire their shares in the stock market at this time and gain the initiative." Feng Yu thought for a while and made a decision.
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