India has started to grab again, and China's vivo was forced to sell 51% of its shares!

Livestock Corps 2024

2024-06-19 11:59Posted in Guangdong financial field creators

India is grabbing again! Why do you say "again"? Because it is a habitual offender, it is not the first time to rob a Chinese company. Last time, India forcibly forced SAIC MG India's subsidiary to sell 51% of the shares, leaving only 49% of the shares, losing its absolute controlling stake.

While SAIC remains the largest single shareholder, the shareholding ratio has dropped to 49 percent, while local employees, dealers and JSW have a combined stake of 51 percent. The major shareholder in India is JSW Steel Group. Where can a steelmaker build a car? It was clear that when SAIC Motor built the MG production line, he hurried over to pick the fruit.

Some people say that when China introduces joint ventures, isn't it also that Chinese and foreign equity are equally shared? But the difference is that China is clearly priced, open and transparent, if you want to enter the Chinese market, you have to accept the conditions of the joint venture, each holding 50% of the shares, and the Chinese market is fully open to you. But what about India? It's not like that. It is to give you various preferential policies first, such as tax exemptions, land incentives, etc. When you contribute money, effort, technology, equipment and production line, the Indian government says, "You can't hold 100% of this company, you have to sell 51% and give the controlling stake to India." ”

So can I open a company and bring in local investment from India? Absolutely. But only if it's fair. In the investment world, there will be a premium for the equity held by the founding shareholders. Like NIO, Li Bin holds 8.5% of the shares, selling 91.5% of the shares, but retaining 38.5% of the voting rights. In exchange for what? A total of 115 billion yuan has been raised. That's the powerful premium power of equity.

MG, as India's No. 1 selling mid-to-high-end electric vehicle brand, is expected to be worth at least $10 billion according to SAIC's own valuation estimates. But what is the valuation given by the Indian government? It is valued according to the original value, that is, how much money you put into SAIC, I buy 51% of the equity, and I will give you back 51% of the original investment. Do you want a premium? Sorry, not a dime. This is tantamount to denying your brand value, denying your potential expected value in the future, denying the value of your talents, and denying the value-added value of your investment, which is a disguised harvest.

It's like if you start a car company and you invest about $1 billion. The company is doing very well, and its sales volume in India is not far ahead, but it is also among the top three in the new energy track. Outside investors think that your company is very promising, with a valuation of at least 20 billion.

At this time, the local government said, what are you doing? Also valued at 200 billion? Give you 510 million and buy 51% of your equity. Are you willing to sell? If you don't sell it, that's good, the factory will be confiscated, the equipment will be confiscated, the account funds will be frozen, and then you will be subject to a huge tax penalty. How do you choose? If you stay, you can also make money together and develop the Indian market together, but if you leave, you won't get a dime back, and you will lose a huge amount of your original investment.

India relied on this style of play to hold SAIC. Now, India is putting its hand in VIVO's pocket again. In India, VIVO ranks third in terms of sales, behind Samsung and Xiaomi, with annual shipments of more than 25 million units and a market share of 17%. Do you say VIVO is worth the money? It's definitely worth the money. In terms of volume, VIVO is larger than MG India. MG India has just built a production line, and sales have just started, but VIVO has been solely operating in India for more than ten years, with two Indian factories with a total production capacity of more than 50 million units. The mobile phones produced by VIVO's Indian factory are not only sold in India, but also exported to Russia, Thailand, Saudi Arabia and other countries.

OPPO, a sister brand of vivo, has also built two factories in India, employing more than 10,000 people. Because of the large number of Chinese brands, India has also become the world's second largest mobile phone manufacturer. But the light assembly manufacturing, India is not satisfied enough. In order to carve up more benefits, India decided to play hooligan and grab it. INDIA SUPPORTS THE TATA GROUP BY FORCING THE ACQUISITION OF A 51% STAKE IN VIVO INDIA, NOT ONLY TO TAKE AWAY 51% OF THE PROFITS, BUT ALSO TO TAKE AWAY A CONTROLLING STAKE IN VIVO INDIA.

This is the same as the forced merger of SAIC MG India. Now, in front of Chinese companies, in addition to MG India and VIVO India, will there be other Chinese companies that will be forcibly plundered by India? For example, Xiaomi India, OPPO India, etc. Chinese companies are looking for the Indian market and cheap labor in India. But the Indian government is interested in Chinese companies.

When India's local companies can't compete with Chinese companies, forcing mergers and acquisitions to forcibly "localize" Chinese companies and turn them into Indian companies has become the last resort of the Indian government. Can't compete, can't you grab it? Which company can stand up to the Indian government? How many divisions does Xiaomi have? How many divisions does VIVO have? Faced with this situation, individual companies simply cannot resist and can only be forced to accept.

This means that "VIVO India" will gradually become "VIVO India"!

What should Xiaomi and OPPO, which have not yet been forced to acquire, deal with? Do you not tremble and tremble?

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