The tide of the viewpoint network ebbed and flowed, Huang Qisen and his Tahoe once rose to a high level, and in the blink of an eye, they fell into the quagmire.
Although the adjustment of the industry has been foreshadowed, it is not easy for real estate companies that are rapidly expanding with high leverage, high debt and high turnover mode to turn around calmly.
From its inception to listing, Tahoe Group has spent 14 years, from a rookie in the real estate sector of the Shenzhen Stock Exchange to a market value of 100 billion, and Huang Qisen and Tahoe have made great progress for 7 years.
However, the twist of fate always comes at the next intersection.
The news of Tahoe Group's delisting came in August 2023, and the former real estate giants have only experienced 6 years from their peak.
At the highlight moment, Huang Qisen's life insurance business, which was acquired with a huge amount of HK$10.6 billion, was also affected by the debt crisis and fell into operational problems, and the dream of "full financial license" has gradually soared.
On July 26, 2024, the Hong Kong Insurance Authority issued an appointment announcement, writing the final end to the story of Huang Qisen and Tahoe Life.
After years of struggling to no avail, Huang Qisen finally lost Tahoe Life.
Final Judgment
Tahoe Life, once regarded as the pearl of the "Tahoe system" in the financial sector, is now entrusted to Deloitte.
On the evening of 26 July, the Insurance Authority of Hong Kong appointed Mr. Lai Ka Yan, Mr Kam Chung-hang and Mr. Cheng Man-lung of Deloitte as joint and several managers of Tahoe Life to take full control of all affairs, businesses and properties of Tahoe Life in Hong Kong.
According to the announcement, the Manager's task is to maintain Tahoe Life's operations and protect the interests of policyholders, and to take appropriate actions to assess Tahoe Life's current financial position.
Hong Kong's Insurance Authority said in the announcement that all existing policies underwritten by Tahoe Life will not be affected by the appointment. Tahoe Life will maintain normal business operations, including policy administration, claims and other customer services.
Mr. Lai Ka Yan, Mr. Kam Chung Hang and Mr. Cheng Man Lung, who have been appointed to take over Tahoe Group, specialise in corporate rescue work at Deloitte China.
At the end of the story, Tahoe Life became the first life insurance company in Hong Kong to be closed by the Insurance Authority, and Wong Kei Sum also stepped down from the management position of Tahoe Life.
Huang Qisen has been listed as a dishonest executor, criticized and warned by the Shenzhen Stock Exchange, and assisted relevant authorities in investigations, but he has basically never stayed away from the core operation of Tahoe Life.
Before Tahoe Life was taken over this time, Huang Qisen was temporarily absent from the public for the longest period on March 16, 2022, when he was taken away to assist the relevant authorities in the investigation.
At that time, Tahoe Group made a sudden announcement, but did not disclose the reason why Huang Qisen was taken away to assist in the investigation, nor did it disclose the results of the investigation. In the following days, Huang Xi, executive vice president of Tahoe Group, and Lin Wenhua, vice president of Tahoe Group, also reported that they were taken away.
Tahoe also issued an announcement here saying that Huang Qisen can participate in the company's operation decisions in an appropriate way, and the company's business activities are normal.
It wasn't until 8 months later that Tahoe mentioned in the stock change announcement that Huang Qisen had performed his duties normally. From being detained to returning, Huang Qisen did not make a high-profile public appearance.
Subsequently, the general election of Tahoe Group was completed, and Huang Qisen still served as the chairman and general manager, and acted as the secretary of the board of directors.
After the thunderstorm, Huang Qisen sold projects and tried a series of actions such as equity financing, price reduction promotion, internal repetition, and farewell to high leverage, but failed to prevent the risk of derailment.
At the beginning of 2023, Huang Qisen said in a research event that Tahoe has come out of the most difficult moment.
However, as of April 28, 2023, the principal of the outstanding loan of Tahoe Group is still as high as 58.203 billion yuan, and the balance of the guarantee corresponding to the substantial overdue debt in the external guarantee is 5.416 billion yuan.
As of July 18 this year, Tahoe Group has also continued to receive legal documents from relevant courts on loan disputes and bill dispute cases, which disclosed that Tahoe Group's subsidiaries have not repaid the principal of 2.4 billion yuan of loans from Bohai Trust and 3.14 billion yuan of loans from Chang'an Trust.
Now, the decision of the Hong Kong Insurance Authority to appoint Deloitte to take over Tahoe Life is also based on a number of legal proceedings in which Tahoe Group is involved in debt recovery.
A spokesman for the IA said that in August last year, the IA appointed an adviser to provide advice and guidance to Tahoe Life under the Insurance Ordinance, but Tahoe Life has yet to submit its audited financial statements for 2022 and 2023, and has not fulfilled its commitment to introduce new strategic investors, and its corporate governance issues need to be improved.
The purpose of appointing a manager is to protect the best interests of policyholders, verify Tahoe Life's latest financial position and solvency as soon as possible, safeguard the company's assets and seek the best corporate recovery plan.
Struggle and goodbye
The "thunder" that led to the collapse of Tahoe Building had been planted as early as when it was taking land everywhere and raising its balance sheet.
In 2014, Tahoe reinvested in land acquisition, and even had a tight capital chain. In 2017, Tahoe Group's land expansion fully shifted to the merger and acquisition model, spending about 55 billion yuan to acquire more than 7.9 million square meters of land.
But in 2018, the property market adjustment kicked off. Compared with before, the land transaction price of Tahoe Group fell off a cliff to about 5 billion yuan. At the end of the year, the balance of Tahoe Group's inventory decline reserve was 307 million yuan.
In May 2019, Tahoe Group received an inquiry letter for its annual report, and 19 questions from the Shenzhen Stock Exchange directly pointed to the company's debt repayment and cash flow issues. Tahoe Group chose to postpone its response to the annual report inquiry.
In a blink of an eye, in 2020, Tahoe Group fell under heavy pressure.
After the fall, Huang Qisen tried everything he could, only hoping that Tahoe could still stand up.
On June 23, 2020, Tahoe Group signed an equity transfer agreement with Minmetals Trust to transfer 19% of the shares of Zengcheng Litao Real Estate Co., Ltd. and Zengcheng Lifeng Real Estate Co., Ltd., Guangzhou Zengcheng Project Company, and the transferee is the trust plan to be established by Minmetals Trust, totaling 1.098 billion yuan.
Since then, Tahoe Group has sold the equity of a number of projects, and the recovered funds have exceeded 10 billion. But compared with hundreds of billions of debts, tens of billions of "blood return" is obviously a drop in the bucket.
Another move by Huang Qisen is equity financing.
In May of the same year, Tahoe Group issued an announcement that the controlling shareholder, Tahoe Investment, was planning the introduction of strategic investors into the company, and the relevant transactions could lead to a change of control of the company.
In July, the "mysterious receiver" surfaced, and Vanke's subsidiary will invest 2.427 billion yuan in Tahoe Group, holding 19.9% of its equity.
After suffering losses from high leverage, high debt and high turnover, Huang Qisen said in 2021 that Tahoe should follow the development strategy of "small and fine" and "small and beautiful".
However, the company's liquidity is still tight, and the net cash flow generated by operating activities in 2021 will be 529 million yuan, and the cash inflow from operating activities, cash inflow from investment activities, and cash inflow from financing activities will decrease by 60.77%, 73.24%, and 63.95% respectively compared with the previous year.
In addition, Tahoe Group's debt-to-asset ratio increased by 2.5 percentage points to 93.25% in 2021 from 90.75% in 2020.
In addition to selling project equity, equity financing and bidding farewell to high leverage, Huang Qisen, who assisted in the investigation after returning from the investigation, also started from the inside and carried out integrity rectification and self-inspection activities from August 15, 2022 to November 15, 2022.
However, all kinds of self-help actions have not succeeded in lifting up the huge Tahoe.
After two and a half years, Vanke said in response to investors' questions on October 17, 2023 that the preconditions for the relevant transaction between the company and Tahoe Group have not yet been reached, and the agreement has not yet taken effect.
Huang Qisen's "came out of the crisis" and eventually became a flower in the water like the 200 billion goal.
In the first half of 2023, Tahoe Group recorded revenue of 1.527 billion yuan, a year-on-year decrease of 52.31%; The net loss attributable to shareholders of the listed company was 2.069 billion yuan. At the end of the reporting period, it held monetary funds of 1.339 billion yuan, total assets of 217.267 billion yuan, and total liabilities of 211.418 billion yuan.
What came before Huang Qisen's efforts to turn the tide and the dawn of Tahoe Group's restructuring was the "Decision on the Termination of the Listing of Tahoe Group Co., Ltd.'s Shares" sent by the Shenzhen Stock Exchange on July 28, 2023.
Recently, Tahoe Group's property under the name of Fuzhou Tahoe New World was delivered to the executor to pay off the debt at an unsuccessful auction price of 2.788 billion yuan, and the parking space in the city square of Jin'an District, Fuzhou, with a starting price of 17.9027 million yuan, was unsold for the second time due to no bidder.
The fall of finance
Huang Qisen's self-help failed to save Tahoe Group, and today he also lost the "pearl" Tahoe Life.
At that time, "if you don't understand finance, you can't do real estate well" was still the slogan put by Tahoe Group on its official website, and "full financial license" was also Huang Qisen's obsession to expand its business territory.
In 2017, Tahoe Investment, controlled by Huang Qisen, completed the acquisition of the life insurance business of Hong Kong's Dah Sing Financial Group for HK$10.6 billion, and signed a 15-year exclusive bancassurance agreement with Dah Sing Bank.
Dah Sing Life changed its name to "Tahoe Life" in November 2017, and Huang Qisen, who obtained the insurance license, took a step forward in the financial field and completed the construction of a "big finance" territory covering insurance, banking, securities, third-party payment and other fields.
Tahoe Life's performance has not lived up to Huang Qisen's high investment, and a "financial pearl" has been lit up in Huang Qisen's business empire. In the first half of 2018 alone, Tahoe Life's performance increased by 5 times compared with the same period in 2017. As of 2019, Tahoe Life's annualized premiums have increased by 509% in three years, and the value of new business has increased by nearly 140% in two years.
However, before Huang Qisen completed his plan to rely on Tahoe Life to enter the world, the cracks in high leverage have made it difficult for Tahoe Group to protect itself.
But for the hard-won insurance license, Huang Qisen did not think about getting rid of it at the beginning.
On April 28, 2020, Tahoe Group announced that it would suspend trading and would restructure and acquire Tahoe Life, a major shareholder. The reason for the restructuring and acquisition given in the announcement is that Tahoe Life is engaged in insurance business, and the acquisition will help the company give full play to its synergistic advantages and meet the needs of customers at different levels.
Tahoe's performance in the capital market is affected by news such as funds and judgment defaulters, and the injection of insurance business into listed companies is not only a positive signal to the market, but also conducive to the development of follow-up financing channels.
However, Tahoe Life issued a statement on May 1 saying that the parent company had stopped studying the feasibility of the asset restructuring and decided to terminate the acquisition plan involved in the restructuring.
Late at night on May 13, Tahoe Group announced that in view of the company's current listing as an executor by the court, the existence of overdue debts and other related reasons, it believed that it could not form a clear and feasible solution to the impact of the transaction in a short period of time, and decided to terminate the restructuring.
With the failure of restructuring and acquisition, the impact of the debt crisis on the other side is becoming more and more serious, and the most urgent need of Tahoe Group is the return of funds.
With the projects in the hands of Tahoe Group being "liquidated and sold" one by one, Tahoe Life Insurance, which Huang Qisen invested tens of billions of dollars in revenue, has once again become a commodity to be sold at a price.
In November 2020, it was reported that insurance giants such as Ping An of China and Sunshine Insurance extended an olive branch to Tahoe Group, planning to bid for Tahoe Group's insurance subsidiary, valued at more than US$1 billion.
As the most valuable financial asset of Tahoe Group, if Tahoe Life is successfully sold, the "blood" funds may be able to temporarily alleviate the urgent need.
However, the deal eventually fell through, and Tahoe Life, which was affected by the deterioration of Tahoe Group's operating conditions, was also rumored to have suspended underwriting new policies in 2021.
According to statistics released by the Hong Kong Insurance Authority, as of 31 March 2024, Tahoe Life had more than 92,000 policies in force. However, some Hong Kong media reported that Tahoe Life also involved policy liabilities of about 18 billion yuan.
A new letter of appointment separates the past from the future, and the story of Tahoe Life and Wong Kee Sum has come to an end.