raknovel Chapter 107 Reverse Chapter: Dog Transformation
Chapter 107 Reverse Chapter: Dog Transformation
Stock Code: 1103
Stock Abbreviation: Koni News Agency
The Board of Directors and all directors of the Company guarantee that the contents of this announcement do not contain any false records or misleading statements, and assume legal responsibility for the truthfulness, accuracy and completeness of its contents.
I. Purpose of Share Repurchase
The company plans to use the funds intended for dividends to reward shareholders by repurchasing shares. The repurchased shares will be directly added to the company's treasury stock, allowing all shareholders to indirectly enjoy the increased repurchase benefits.
II. Types of Shares to be Repurchased
The type of shares repurchased this time are ordinary shares issued by the company.
III. Methods of Share Repurchase
The company will repurchase its shares through the Kowloon Stock Exchange via centralized bidding or tender offer.
IV. Term of Share Repurchase
The repurchase period shall not exceed 12 months from the date the board of directors approves the repurchase plan.
V. Amount, Quantity, and Maximum Price of Shares to be Repurchased
1. Total repurchase amount: not less than HKD 3000 million (inclusive) and not more than HKD 3600 million (inclusive).
2. Number of shares to be repurchased: Based on the upper limit of the repurchase price, the number of shares to be repurchased is expected to be approximately 360 million shares, representing approximately 7.2% of the company's total share capital.
3. Maximum repurchase price: not exceeding HK$10 per share (inclusive).
VI. Purpose of Share Repurchase
The shares repurchased this time will be used to reward all shareholders.
VII. Source of Funds for Share Repurchase
The funds for this share repurchase will come from the company's own funds or self-raised funds.
Special announcement.
Board of Directors of The Rising Sun
Date: 1973/3/5
…………
The news agency's proposed share buyback announcement is like a boulder thrown into a calm lake; people on the surface and below the lake see different things.
Shareholders of the Koo News Corporation have come forward to oppose this improper practice, believing that Chen Guanjiang is abusing his power for personal gain and embezzling public funds.
Other listed company shareholders see a different picture. In addition to traditional stock dividends and other ways to make profits, they may also try this approach.
The regulatory authorities, on the other hand, have a much bigger headache!
Generally speaking, listed companies only have two options: to pay dividends or not to pay dividends. Because shareholders have long coerced them into selling off their shares if they don't pay dividends, paying dividends has become a way for listed companies to maintain their stock prices.
However, the more profits are distributed as dividends, the less money listed companies have for development, and they gradually head down a dead end by living off their past achievements.
Unexpectedly, there is such a way of rewarding shareholders by repurchasing shares, which is a way of distributing dividends only to shareholders and excluding retail investors.
When shareholders report a violation, regulators are obligated to investigate, but the results of the investigation left them speechless.
Chen Guanjiang received a salary of only HK$1 for a long time. After three months of development, he not only acquired the copyrights of five films by Li Xiaolong, but also fully acquired Kowloon Club and a 25% stake in TVB.
Furthermore, the company's market value, which was HK$1.3 million at the time of its listing, was increased to HK$4.25 million, with HK$3600 million in cash and HK$3000 million in Hutchison corporate bonds remaining on its books.
With such great achievements, what's wrong with receiving some stock rewards? Does being the chairman and general manager mean you have to work for love?
Normally, a proposed share buyback, whether awarded to shareholders or executives, or used as treasury stock for cancellation, represents a reduction in the number of shares in circulation.
Since the number of shares in circulation has decreased, the stock price should have risen. However, Hong Kong stock investors had never seen this kind of manipulation before and simply believed that Chen Guanjiang was abusing his power for personal gain.
If this continues, Chen Guanjiang will eventually be able to drain the entire Yanxun News Agency by awarding stock bonuses. As a result, the stock price has not risen but fallen.
The stock price plummeted from HK$8.5 per share at the opening to HK$6.3 per share, and then continued to decline until it stabilized at HK$5.8 per share, a figure exactly the opposite of the opening price.
The total number of shares issued by the news agency was not 2500 million at the time of its listing. Including the newly issued 2500 million shares, the total number of shares issued was 5000 million.
At HK$5.8 per share, that means the market value of The News of the Ringling Ring has been reduced to HK$2.9 million by the proposed share buyback announcement? That's absolutely unbelievable.
Today, the King News is no longer a company whose market value was inflated by a bubble when it went public, but rather a company with a large number of high-quality assets.
The Kowloon Club alone is worth HK$100 million but has no market value. Isn't that a real asset?
HK$3600 million in cash + HK$3000 million in debt, totaling HK$6600 million in actual assets.
Doesn't a 25% stake in TVB plus the copyrights to five of Bruce Lee's films amount to HK$100 million in actual assets?
A newspaper, a printing plant, and three highly profitable newspapers—even if a major stock market crash were to occur, how could they not support a market capitalization of HK$4.25 million?
A market capitalization of HK$2.9 million!
This has caused the financial bubble to burst.
Back then, when we had no actual assets, we bought like crazy!
Now that all that's left are the actual assets, are they selling them off like crazy?
Anyone who has read all of the reports from the Hong Kong Broadcasting Corporation and studied asset prices through these reports will never sell when the share price is below HK$7, and will even buy blindly during the proposed buyback period.
The announcement even clearly stated that the repurchase limit would not exceed HK$10 per share.
This means that with the support of the Hong Kong News Agency, they bought all shares below HK$10 each before the HK$3600 million in cash ran out, but even so, the price was still driven down to HK$5.8 per share.
Chen Guanjiang was at a loss for words to express his feelings at that moment. He could only say that ordinary people really shouldn't speculate in stocks. Making money like this is like committing a heinous crime.
Helpless, Chen Guanjiang bought back 5.8 million shares, representing 12.4% of the total share capital, at HK$620. Combined with his personal holding of 17.5%, his shareholding reached 29.9%.
Little did they know!
This move by the Kwangtung News has truly harmed many people!
Before the stock market crash, most listed companies bought shares of other companies in order to boost their own stock prices. This tactic is also known as the "capital ladder" method, where one foot steps on the other and spirals upwards.
The New York Times raised HK$2.06 million by issuing new shares, attracting a number of listed companies to buy its stock.
Later, it was reported that the company would acquire a 25% stake in Kowloon Club and TVB, and a number of listed companies increased their shareholdings significantly.
Who would have thought!
After Chen Guanjiang finished eating and drinking, he overturned the table, triggering a stock market crash that trapped them all.
Just when things seemed hopeless, a new path opened up. The proposed share buyback demonstrates the capabilities of any company that has managed to go public. They immediately recognized that the share buyback would reduce the supply of shares and inevitably drive up the stock price.
Everyone was eagerly waiting to sell and break even, but who could understand why the stock price didn't rise but instead fell? This doesn't make any sense!
Regardless of whether the proposed share buyback is intended to reward shareholders, cancel shares, or be used for treasury purposes, let's focus solely on capital.
If cash is more useful, especially with soaring interest rates, why would listed companies use cash to buy back their own shares?
There is only one possibility: the listed company believes the stock price is undervalued, or it has significant positive news that it does not want to share with shareholders.
Logically and emotionally, given that the news outlet is planning to repurchase shares, the stock price shouldn't be falling!
What pained them even more was that, despite calculating that the share price of the newspaper was below HK$7, they were unable to acquire the shares of the newspaper due to overdrafted credit and tightened bank lending.
Banks, investment opportunities, and funds may have money, but for them, a loan interest rate as high as 16% is a sure-fire way to make money, rather than an undervalued company that doesn't pay dividends.
After all, everyone knows how to do the math.
If the share price falls below HK$5.8, the resulting long-term gains will cover the 16% loan interest rate; otherwise, the stock might be trading sideways.
Chen Guanjiang chose HK$5.8 precisely because of this factor. If you can't even do the math, what are you doing in the capital market? Just learn from stock market investors, close your eyes, and happily charge forward.
…………
The Second Annual General Meeting of Shareholders of the Koo News Agency!
Despite the devastating floods outside, the atmosphere inside was one of joy and celebration.
Chen Guanjiang, holding the report, sat in the main seat and announced with a smile: "In order to reward the company's shareholders and directors for their effective management, the board of directors has resolved to repurchase shares to reward the shareholders and directors."
"Chen Guanjiang owns 17.5% of the shares, with a return on investment of 175 million shares..."
Chairman Chen Guanjiang is rewarded with 50 shares for his dedication during his tenure…
"General Manager Chen Guanjiang's outstanding performance resulted in a return of 30% on shares..."
As Chen Guanjiang's one-man show, and at the same time bringing such great profits to the company, the news agency deservedly took the largest slice of the pie with 255 million shares.
"Independent non-executive director Li Guoneng performed her duties diligently during her tenure and was rewarded with 50 shares..."
"Executive Director Zhou Zhanqiao worked diligently during his tenure, and was rewarded with 20 shares..."
"Executive Director Tang Yufei will receive 10 shares as a reward..."
"Deputy Editor-in-Chief Hao Yuze, rewarded with 5 shares..."
"Management received a reward of 5 shares..."
"The remaining 275 million shares will be included in the company's treasury stock and may be reissued or awarded to shareholders or senior executives through non-trading transfers in accordance with specific incentive plans, depending on market conditions and the company's operating performance."
*Clap clap clap clap!*
A round of applause erupted, and everyone present received a piece of cake, more or less. Zou Wenhuai's face showed an awkward, forced expression as he echoed the applause.
Through a series of transactions, Chen Guanjiang increased his personal shareholding to 22.6%, and also controlled 5.5% of treasury shares, valued at HK$6554 million and HK$1595 million.
Li Guoneng, as a legal advisor, received a reward of 50 shares, worth HK$290 million based on the current share price. Everyone knows the real reason: it was a dowry for Chen Xiangshui.
Zhou Zhanqiao felt he couldn't compare to him. The 20 shares he received as a bonus were not small. He had earned HK$116 million in just three months of employment. Most importantly, he had a position and was very satisfied.
Tang Yufei was even more satisfied. 10 shares were worth HK$58, a figure he wouldn't have dared to dream of six months ago, which further strengthened his determination to follow his boss.
Initially, when Tang Yufei was hinted to take photos as evidence, he still harbored resentment towards Chen Guanjiang.
Now, I only regret that I was so conservative when taking photos; I should have been more daring.
All the senior executives, more or less, had received stocks worth tens or thousands of Hong Kong dollars, but only the deputy head, Hao Yuze, was forcing a smile.
In terms of ability, Hao Yuze believes he is no less capable than Tang Yufei.
In terms of seniority, they were all high-ranking officials from the previous dynasty who rose to power.
Why is it that Tang Yufei is appreciated by the boss, while he is relegated to a subordinate position with an increasingly large gap in status?
From his seat of honor, Chen Guanjiang took in the diverse faces of the people around him, watching them force smiles while a mysterious smile appeared on his lips.
Chow Wen-huai is no longer valuable, and the entire Golden Harvest is not very valuable either. Did they think that by getting $650 million to build theaters and film studios, they could compete with Shaw Brothers?
Li Xiaolong is about to say goodbye to him. By the time the theaters and film studios are built, the land will have already fallen to its lowest point. If it has no value, it has no right to share the pie. That's just how reality is.
Having tasted success, this guy even wanted to merge Golden Harvest into the Yahoo! News for a backdoor listing?
Unfortunately, Chen Guanjiang squandered Golden Harvest's most important assets and showed no interest in its cinema chains and joint cinema chains. He had to swallow the bitter pill of falling land prices himself.
Hopefully, they didn't mortgage the land to expand their operations. Otherwise, with banks tightening credit and land prices falling, there's a shortage of collateral, and Golden Harvest could very well end up insolvent. Amen!
Then look at Hao Yuze…
People are not worried about scarcity, but about inequality. Chen Guanjiang understands this principle, but after all, there is only one position and there is a priority order.
As one of the right-hand men promoted together in the early days of the newspaper acquisition, he has long been used to check and balance Tang Yufei.
With Tang Yufei's self-defamation and defection, Hao Yuze's usefulness diminished. He was relegated to managing the company's finances as a deputy, serving as a test of his character and a talent reserve.
The Kowloon Broadcasting Company was listed only on the Kowloon and Far East Exchanges. Its shares could be traded in small-share brokerage shops or privately, but the registration of share transfers could not be bypassed by the two exchanges.
The stock granted to other shareholders and all senior executives, each with their stock serial number, is on record.
As soon as they sell, Chen Guanjiang will know immediately and launch an investigation into the reasons or motives behind their stock sale.
Holding the stock long-term indicates confidence in the future of the news agency, and also signifies a willingness to stand with the agency through thick and thin.
If someone turns around and abandons you, it means they only care about short-term gains or have ulterior motives. Such a person should be considered for retention or dismissal.
By examining 5 shares, Chen Guanjiang gained a clear understanding of the senior executives, especially the entire department merged from Oriental Daily News. He realized that Chen had never truly trusted them, and a future showdown with his former employer was inevitable.
This also makes it clear whether Hao Yuze's character is worthy of being given important responsibilities, and whether he will have more than just the position of editor-in-chief in the future.
But trust comes at a price; you have to hand over at least one of your weaknesses or your character. You can't bind everything with interests.
"Compared to our success in the capital market, our business has been a failure; the newspaper is our core business!"
To prevent the executives from getting carried away, Chen Guanjiang poured cold water on their enthusiasm, saying, "The sales of all three newspapers are declining. This is your dereliction of duty. Don't you want to give me an explanation?"
"I know that there are some market reasons involved. 'Financial Dog Express' reports on the stock price decline every day, 'Wang Dog Daily's' dog-related market is declining, and 'Hyena Weekly' has fewer hot topics."
"But this is no excuse for declining sales!"
"The 'Financial Dog Express' and 'Wang Dog Daily' will be reorganized with the nighttime news. Once I take over the management of the TVB News Department, I will integrate and restore 'Hyena Daily' and 'Hyena Evening News'."
"By the end of the year, I want to see daily newspaper sales exceed 100,000 and evening newspaper sales exceed 60,000! If we do well, we will not hesitate to reward us with stock options at the end of the year; if we do not do well, we will not hesitate to demote us to the printing plant."
"Are you confident you can do a good job?"
"have!"
“…………”
While speaking, Chen Guanjiang kept observing Gong Hui's team, whom they had obtained by exchanging half of Peng Lilai's codebook, the Oriental Daily.
The revived "Wang Gou Daily" was managed by their team alone. Fortunately, nothing went wrong, but they were ultimately not of one mind.
This profit-sharing, which forcibly integrates them, is both a test and a form of acceptance.
Forming cliques and factions is perfectly acceptable, because it's human nature to stick together for mutual support.
Even if it is split up, new factions will emerge. Even if everything is swept away and only one group remains, different factions will automatically split out within it.
Whether it's the contest between Tang Yufei and Hao Yuze, or Zhou Zhanqiao's team suppressing Tang Yufei and Hao Yuze, it's all about maintaining normal factional struggles within a collective.
Therefore, what Chen Guanjiang needs to do is not to eliminate them, but to unite them with his own interests and ensure that they compete against each other under the framework of a collective and common interests.
It would be great if they were willing to join.
If they don't want to stay, there's nothing we can do.
The news agency has accumulated enough experience and it's time to challenge other areas, but internal stability must come before external expansion; they don't have much time left...