Rebirth of England

The British Railways Steamship Company that Barron is interested in has a long history.

P\u0026O was founded in 1822.

They also have a large amount of business in Asia - on December 31, 1840, the Peninsula Oriental Steamship Company was established in London with a capital of 1 million pounds. With the pace of colonial conquest, the railway business also spread to Egypt, India and even Lijiapo and Hong Kong.

The full name of P\u0026O Group is Peninsular and Oriental Steam Navigation Company, literally translated as Peninsula Oriental Steam Navigation Company.

From the very beginning, the Railway Company had a near-monopoly on Hong Kong's early external shipping business: at the end of the 19th century, the Railway Company made HK the regional headquarters for its Far East business, and set up a branch in the Western District of HK. In addition to an office building, there was also a private dock.

The Chinese name "Tie Xing" came from the fact that when the HK company was established, the company's Taipan (comprador) could not think of a Chinese name that could properly convey the meaning of "Peninsula Oriental". When he saw the iron railings on the terrace, he casually Picked up the word "tiexing", so this name has been used to this day.

In 1971, the Railway Group was reorganized into five major business sectors: shipping, truck freight, passenger transport, European and air transport operations, and general holding businesses.

Then in 2002, Railway Group merged with Carnival Group, involving an amount of US$5.4 billion.

After the transaction is completed, Carnival will hold 74% of the shares of the new company formed after the merger, while Tiehang will hold 26% of the shares.

The two major companies joined forces and immediately created a "Big Mac" in the global cruise market. After the acquisition was completed, Carnival included almost all well-known cruise brands, and the number of cruise ships it owned increased to 73, accounting for a total value of US$11 billion. Nearly 40% share of the global cruise market.

Before being acquired by Dubai World Group, Railway Shipping Company owned 29 container terminals in more than 100 terminals in 18 countries around the world, and has become the world's leading terminal operator.

This includes many terminal projects in China that they have invested in. For example, on July 21, 2003, China Railway Group, Maersk Group, COSCO Group and Qindao Port Group jointly invested in the Qindao Port Qianwan Container Terminal Joint Venture. project.

In the reorganized Qindao Port Qianwan Container Terminal Co., Ltd., the total investment is US$887 million, of which Tiexing Group holds 29%, Maersk Group 20%, COSCO Group 20%, and Qindao Port Group 31%.

In the British mainland, the Railway Shipping Company's railway shipping company has a total of 32 passenger ships traveling between Britain and European coastal countries every day.

Tiehang Cold Storage Logistics is the world's largest temperature-controlled logistics provider.

China Railway Group, a 50:50 joint venture with China Railway Group, is the second largest container freight company in the world. It has more than 70 fixed routes, connects 230 ports in 120 countries, and owns or leases 147 ships.

Five years ago, in 2004, Dubai World Group defeated its rival Lijiapo Port Group and acquired the British Railway Group for US$6.8 billion. This immediately jumped Dubai World Group from seventh place in the ranking of global terminal operators. For the third place.

Ranking ahead of Dubai World Group are HK Hutchison Group and Lijiapo Port Group.

Together with British Rail Line's 29 container terminals around the world, DP World's global container terminals have also increased to 51, and its container throughput has also increased to 33.3 million TEUs.

However, Dubai World Group, which is facing debt default, now has to obtain funds by selling their assets to avoid this situation from deteriorating.

Therefore, when Global Industrial Investment Fund (GII) CEO Finn Hudson went to Dubai and proposed to acquire the British Railway Group, they also showed a positive attitude towards this.

"The acquisition price we are currently proposing is US$6 billion, but Dubai World Group has expressed that it is difficult to accept such a price. They hope to sell the Railway Group for at least US$6.8 billion, the price they originally acquired."

Finn Hudson said:

"But I think that if we insist, then it is very likely that they will eventually compromise. After all, so far, the projects invested by Dubai World Group have experienced a very large decline in market value. In comparison, Railway Group has already become a The value has been preserved…”

“In addition to price factors, we also need to consider whether the Railway Group will be affected by the delay. After all, although Dubai is eager to solve the current crisis, if it takes too long, it will not matter to us. Good thing."

Although Dubai World Group originally acquired the British Rail Group for US$6.8 billion, due to the impact of the subprime mortgage crisis, not only the market value of many companies has been greatly reduced, but also the global port shipping business has entered a recession due to the economic recession. In a downward cycle, it is normal to appropriately lower prices.

But Barron also knows that if Dubai World Group prepares to sell the Railway Group, the GII Fund is not without competitors. For example, when Dubai World Group acquired the British Railway Group, Lijiapo Port Group had bid with them. .

As the world's second largest port group, if it can merge with the P\u0026O Group, then the Lijiapo Port Group will be able to surpass HK and Whampoa Group in one fell swoop and take the top spot, which is also quite tempting for them.

Moreover, after acquiring the P\u0026O Group, Barron still has a lot of things to solve.

For example, before Dubai World Group acquired the British P\u0026O Shipping Company, the P\u0026O Group owned six container ports in the United States, located in New York, New Jersey, Baltimore, New Orleans, Miami and Philadelphia.

However, during the process of this transaction, the United States has not passed the review of this transaction.

The reason is that at that time, a considerable number of American congressmen believed that the UAE, a country associated with the 9/11 hijackers, operating American ports would threaten their national security.

Since the September 11th incident, the United States has regarded airport and port security as the "top priority" of national security. In January 2002, the "Container Security Initiative" was proposed and regarded as an important part of the United States' global anti-terrorism strategic deployment, aiming to prevent terrorist organizations or terrorists from using the weak links of container freight to attack the United States.

They believe that if Middle Eastern companies control the six major ports in the United States, the so-called container security issues will make the US security department more worried.

Although Bush Jr. at the time worked hard to promote the completion of this transaction, after a long review, Dubai World Group finally compromised and handed over the operation of the six container ports in the United States to the relevant institutions of the United States to complete this transaction.

If the GII Fund can complete this acquisition, then with the same British background of the GII Fund, it will naturally be able to take back the operating rights of the six container ports in the United States.

Therefore, after comprehensive consideration, Barron still asked Finn Hudson to make appropriate compromises in terms of price to speed up the time for them to complete this transaction.

It can be said that many of Barron's businesses currently rely on shipping, such as the petrochemical products and natural gas of the United Petroleum Group, the products of the Argos Retail Group, the British Motor Group, etc. Therefore, the acquisition of the P\u0026O Group is still very important for his future layout.

And it is not just the P\u0026O Group. You must know that Greece itself is also a major shipping country. So taking advantage of the Greek sovereign debt crisis, he can not only in the financial field, but also take the opportunity to acquire some Greek shipping companies.