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On December 17, the negotiations were reached!

Purple Star International has reached an agreement with Lufthansa to complete the transaction for its IT infrastructure department.

There are mainly three major clauses.

1. The transaction price was US$1.25 billion, paid in cash. It is divided into 5 installments in total, the first installment is US$250 million before this month, and the remaining US$1 billion will be paid in 4 installments in the next two years, with US$250 million paid every half year.

Second, there should be no large-scale layoffs.

Third, all infrastructure services required by Lufthansa will be outsourced to Ziweixing International for a period of 5 years.

After signing the contract, the news can be announced to the outside world on the same day and then put into operation immediately. It will pass the approval of the relevant German departments before the 20th and the EU before this month.

That night, Lufthansa held a low-key but grand cocktail party.

It feels like Wolfgang Maierhuber, the chairman of Lufthansa, is even happier than Zhou Buqi. He is holding a beer and looks proud of himself. He does not look like an old man in his sixties at all.

Zhou Buqi also complained in his heart.

Similar social events in other places basically involve drinking red wine. These German guys are really weird. They all drink beer together, as if beer is the image of their country.

However, when it comes to business cooperation, Zhou Buqi has always been very sincere, and he also has a helpful quality. "With this cooperation, Lufthansa's financial difficulties should be solved, right?"

Now that the deal has been concluded, Mr. Maierhuber no longer needs to hide too much. He tells the truth: "It is expected to save US$70 million in expenses every year."

Zhou Buqi glanced at him and said, "It's just an emergency, right?"

Mai Yahuber was slightly silent. It was hard to talk about this topic. Leaking the news would affect the company's stock price and employee confidence.

Zhou Buqi said sincerely: "Times have changed. In the past 20 to 30 years, the globalized economy has not developed, information has been blocked, and the economy has been isolated. Lufthansa's model can still work. It can't be done now. Facing an increasingly open market economy and global competition, the nature of state-owned enterprises destined Lufthansa to encounter more and more crises in the future."

Maya Huber deeply agrees, “In the past, airlines invested too much, and in Europe they were basically dominated by state-owned enterprises. However, in the past decade or so, the market economy has developed too fast, and the business model of the aviation industry has also changed. Since then, The subscription system turned into a leasing system, so that more and more private airlines appeared."

In the early years of the aviation industry, airlines bought aircraft from aircraft manufacturers. For example, ordering 200 or 300 aircraft at one time would cost tens of billions of dollars.

Private capital simply cannot afford such a large amount of money.

Therefore, in the early years, airlines in Europe were basically state-owned enterprises, and the state paid for the aircraft.

However, with the development of the times, the business model has also changed. Airlines no longer need to spend tens of billions of dollars to buy aircraft. Instead, they should learn from the United States and adopt a leasing system.

That is, the airline leases the aircraft from the aircraft intermediary and gives a certain leasing fee and revenue share.

In this way, airlines have changed from super asset-heavy companies to light and middleweight companies, and more and more private airlines have appeared. Then, state-owned airlines in Europe began to close down one after another.

In fact, airlines and aircraft leasing agencies each get what they need. It is a blend of capital and business.

Airlines have professional capabilities and aircraft leasing companies have strong funds. The two parties hit it off immediately, and the money they made was shared proportionally. Li Chaoren of the Hong Kong government discovered that this was an excellent business, so he acquired an aircraft leasing company and acquired dozens of aircraft to engage in this kind of intermediary business.

You don’t have to do anything, just buy a batch of planes, then lease them to airlines, and you’ll be able to “collect taxes” steadily every year.

With this new business model, private airlines and state-owned airlines have the opportunity to compete on the same stage, and state-owned airlines have been severely squeezed. Even super giants like Lufthansa cannot withstand it and are squeezed out by private low-cost airlines.

Zhou Buqi's foresight did not cover the situation of the European aviation industry in the next few years, but his analysis based on the principles of market economy was not wrong.

This time Lufthansa sold its IT infrastructure department, which indeed alleviated the short-term crisis. In fact, it was treating the symptoms rather than the root cause.

The essential attributes of state-owned enterprises that cannot compete with private enterprises will lead to Lufthansa's decline over time. To continue to sell assets and survive, it is necessary to continuously apply for billions of euros in relief funds from the German government.

Zhou Buqi said: "Lufthansa must restructure itself if it wants to completely solve its market difficulties. Our country once had a company called Jianlibao, which made drinks. At that time, its market share was higher than that of Coca-Cola, but it was a state-owned enterprise. The executive operation was restructured, but it was rejected because of the suspected loss of state-owned assets. Within a few years, the company collapsed."

Mai Yahuber looked at him deeply and said, "Mr. Zhou, when it comes to the restructuring of state-owned enterprises, we have more experience than you!"

"Right!"

Zhou Buqi laughed.

Europe also advocated state ownership for several decades, but soon discovered that something was wrong and began to change quickly. Before the restructuring of domestic state-owned enterprises in the 1980s and 1990s, the first thing they did was to send a team to Germany to study, and then invited a group of German experts to go back and impart their experience.

Maier Huber pondered: "The problem facing Lufthansa is not market competition, nor the loss of state-owned assets. These are not the key. The core is the employees, and the employees who rely on Lufthansa's huge industrial chain."

Zhou Buqi was taught a lesson, "Well, stable employment is the most important thing."

"That's right." Maya Huber nodded, "I have been to your country several times, and the way you treat workers... If you want to start a business in Europe, the core factor is not how much value you create, nor the way you treat workers..." Which countries you have conflicts with and which politicians you have disagreements with depend on how many stable jobs Europe can create around your industry."

Zhou Buqi made it clear at one point, "Employment is votes."

Maier Huber smiled and said, "I know you are worried about the future of Lufthansa. There is no need to do so, because you cannot look at such a company from a market perspective. The industrial chain surrounding the Lufthansa Group covers millions of people in Germany." If there are jobs, Lufthansa cannot fail. To be long is to integrate like British Airways and West Air and continue to survive."

Now Zhou Buqi finally understood why there was such a big problem in the European economy.

The market has been kidnapped by votes.

From a market perspective, low-end and inefficient state-owned enterprises like Lufthansa should be split up as soon as possible, sell them if they can, give them away for free if they can't, and hand over assets and resources to competent people to manage.

Only in this way can the greatest value in society be created.

But in this case, the unemployment rate is likely to rise significantly in a short period of time, and politicians cannot afford the price of reform. They reformed and stepped down, only for their successors to receive the fruits of the reform.

Take Britain for example. After Mrs. Thatcher came to power, she adopted a very strong stance and promoted the reform of British state-owned enterprises. Basically, they were half-sold and half-given, and all were given to private capital. The British economy recovered rapidly, and productivity and creativity were stimulated again. But when Mrs. Thatcher died, the whole country in Britain was rejoicing, wishing that she had died too late.

From this point of view, if Ziweixing International wants to firmly grasp the European market, it should start from this perspective.

Providing jobs means winning votes and can kidnap the whole of Europe.

The Internet is asset-light, which is definitely not possible. It still has to rely on large-scale infrastructure, such as cloud data centers and the fiber optic business that Curian is obsessed with.

The acquisition of Lufthansa's IT infrastructure department really has a lot of added value.