Chapter 1556: The Fear of Vicious Acquisitions
Why did multinational corporations want to acquire Country Z’s enterprises?
Because Country Z’s underdeveloped market was too tempting.
Country Z’s population was not only large, but it also had an alarming consumer potential as well as thousands of years worth of brilliant cultural heritage. These caused foreign investors to crave the acquiring of Country Z. Furthermore, the people of Country Z were hardworking, pragmatic, could create value, and were shockingly effective.
For example: when the people of Country Z opened a hair salon in Italy, there was no one who could compare to them.
An Italian-owned hair salon would have 8 fixed working hours a day. Past the working time, they would reject customers.
However, a hair salon opened by the people of Country Z would operate 24/7, non-stop. They would also adopt a three-s.h.i.+ft system to improve flexibility and effectiveness.
a.s.suming that the Italians managed to cut the hair of 50 customers in the 8-hour s.h.i.+ft, they would earn 5,000 yuan. However, people from Country Z would be able to cut the hair of 150 customers in their 24-hour s.h.i.+ft and earn 15,000 yuan.
Be it the effectiveness or the profits of the hair salon, Country Z’s salon would surpa.s.s the Italian’s by at least three times.
The 150 heads styled was a representative of Country Z’s effectiveness.
The 15,000 yuan earned was a representative of Country Z creating value.
These two points showed how no country could match up to Country Z.
It was not that foreign investors did not try to invest in Country Z’s appealing market. However, upon entering the country, investors realized that they were inferior to the local enterprises’ compet.i.tive pricing and efficiency. Hence, the acquisition allowed the compet.i.tors to wait at ease.
This kind of acquisition was very cruel. On one hand, it could directly obtain the mature sales channels of the enterprises in Country Z, expand its market network, increase the pool of talented individuals as well as consumer resources. On the other hand, buying over opponents gave one the opportunity to completely eliminate them, directly overshadowing their brands. This monopoly greatly benefited oneself and led to a great surge in profits.
Throwing money at a company that you could not compete with—this was multinational corporations’ strongest yet most despicable method.
Foreigners’ goals in businesses were never disguised, similar to years ago when they launched a joint aggression war against Country Z.
Direct violence!
It was disgustingly awful.
Wen Xinya was able to antic.i.p.ate the chaos faced by Lanxin Company. After keeping silent for a short while, she said, “Foreign multinational groups that like to engage in vicious mergers and acquisitions have always had a ferocious appet.i.te. The health supplements in Country Z is the fattest piece of meat. Since the opposition is already interested in this industry, it is impossible for them to only go after Lanxin Company. Although Lanxin Company has incredible growth potential, it is still not a listed company and may not satisfy the opposition’s appet.i.te. As long as other companies have wealth and power, why wouldn’t the opposing party try to acquire them as well?”
Was it worth only going after Lanxin alone?
Of course not!
Country Z’s health supplements’ development history was too shallow, and its foundations were too weak. Although its domestic developmental standard was quite good, there were no products that had the potential to be developed for overseas use and become an untouchable giant in the market.
That was why it was so easy for foreign multinational corporations to acquire state-owned enterprises and not waste much effort. The keyword was “money”.
If you had the ability to eat the entire piece of meat, why settle for a piece only?
Yan Shaoqing paused for a moment and then said with a look of disbelief, “You mean that they are not only planning on acquiring Lanxin Company but other domestic health supplements brands as well?”
Although Country Z had many domestic health supplements brands, there were only a few notable and powerful brands occupying the market. Hence, if the opposing side had its eyes on Country Z’s health supplements brands, as long as they were able to acquire the top 3 brands in the market, he would be able to monopolize it.
This was something that foreign multinational corporations often did.
He did not think of that.
Yan Shaoqing was extremely annoyed.
Wen Xinya spoke, “I guess that’s close to the mark. I made Ou Yangfeng check out other healthcare companies’ stock markets. If all goes well, we will know who the snake is.”
If the opposing side really had such a huge appet.i.te, their movements would not be too small, making it impossible for them to hide it.
Wen Xinya’s clear and knowledgeable voice from over the phone was able to a.n.a.lyze the situation at hand in an organized and logical manner. This gradually allayed Yan Shaoqing’s anxieties.
With a deep breath, Yan Shaoqing regained his calm and well-tempered composure. “If that’s the case, the opposing side will become even stronger and unpredictable. More importantly, the opposition is facing us prepared and fiercely. Lanxin will have to face a tough battle.”
The ability to acquire the top 3 domestic enterprises was proof of the opposition’s terrifying power. This would truly be Lanxin Company’s most serious issue.
Wen Xinya gave a slight frown and, after a long pause, asked, “How is the company’s current situation?”
Regardless of how prepared and aggressive the opponent was, they had to first stabilize themselves and prevent themselves from messing up. Only by doing so would they have the chance to fight back.
Yan Shaoqing commented, “The company’s situation is still stable. With Zheng Yifan managing it, there will be no problems for now.”
Zheng Yifan was indeed gifted when it came to management duties. When the stock market fluctuated, he would adopt a series of measurements that not only rea.s.sured the hearts of the people but also temporarily stabilized the stock market. But for this particular situation, he would have to observe the subsequent market developments.
Wen Xinya nodded. “For the time being, the opposing side wants to forcefully buy over Lanxin Company. Hence, they will probably aim to gain 30% or more of Lanxin’s shares. According to the current situation, the opposing side’s secretive operation will be subjected to various restrictions. It is also estimated that acquiring the remaining 10% will be difficult for them. The crucial task is still to organize the company’s current affairs and to find out who the snake is.”
Foreign multinational corporations were scary. However, were they really impossible to overcome?
Wen Xinya calmly raised the corners of her lips. She did not think so!
Yan Shaoqing listened to her orderly and rational arrangements regarding the acquisition. He took a deep breath and replied, “I understand!”
In his eyes, Wen Xinya had always been a magical lady, who was best at creating miracles and legends.
Wen Xinya spoke again, “Send me the latest report of Lanxin Company’s stock market and various a.n.a.lytical data and materials. Tomorrow at 10 AM, Lanxin Company will hold a high-level emergency meeting.”
She still needed a little bit of time to fully comprehend Lanxin Company’s current situation.
After hanging up, Wen Xinya gently rubbed her temples and could not help but let out a sigh. Malicious acquisitions were an inevitable part of economic progression. In order for companies in Country Z to partic.i.p.ate in the international field, they must be able to overcome tough obstacles. This was Lanxin Company’s first step onto the international playing field.