Recently, with the news that Kemou, the former president of Evergrande Real Estate, a subsidiary of China Evergrande, has been taken away for investigation, the suspicion about the arrival of "liquidation" in the industry is rampant.
pictures of online information
CBN verified information from multiple sources, showing that Ke was not the first professional manager of Evergrande Department who was taken away for investigation, but he was a senior manager so far. He became the president of Evergrande Real Estate Group in October 22 and resigned in mid-222.
On the 7th, the reporter called Ke, and was already in a call reminder state. Another internal news shows that several of Ke's previous cronies are in a state of losing contact together.
in August, 22, before Ke Mou became the president of the real estate group, the financial situation of China Evergrande was concerned by the outside world because of an online "distress letter". Although this year's Evergrande completed the spin-off and listing of Evergrande Property and several rounds of investment and financing of Evergrande Automobile, the share prices of Evergrande departments represented by Evergrande Property, Evergrande Automobile and Hengteng Network have climbed to historical highs, but insiders have vaguely felt that "money is tight". "For a while, all the money in the group was in arrears, and only two departments could use cash, one of which was the financing department. As long as a sum of financing could be obtained, the reward commission would be settled, with a maximum of 1 million yuan and a reward of 15, yuan."
Kemou, who took office at this time, is faced with the new mission of stabilizing the operation of the real estate group and reducing the financial leverage. If all went well, he could have become a righteous minister. Why did he become the first Evergrande executive to be investigated?
career star
Xu Jiayin, the board of directors of Evergrande Group, attaches great importance to loyalty. Most of his cronies are old people who work hard with him for the New Year, but at the same time, they are willing to promote young people. There are many young executives in their thirties and forties in the group, and Ke Mou is one of them.
Kemou joined Evergrande at the end of 28, when China Evergrande failed in its first listing. However, with the rapid recovery of the domestic real estate market in 29, Evergrande also began to usher in the most magnificent stage in the company's development: successfully landing on the Hong Kong stock market, acquiring Guangzhou Football Club and winning the AFC Champions League in the Super League, ranking first in the industry in terms of annual sales scale of real estate development, and Xu Jiayin becoming the richest man in China
During this period, Evergrande has tasted the dividends of the great development of the property market, and also made a unique splash. Many ordinary people in China know the name of Evergrande. In some small cities along the 4th and 5th lines in the Mainland, local officials in charge of investment promotion once regarded Evergrande as the absolute leader of real estate enterprises, and its popularity surpassed Vanke and Country Garden.
Kemou rose rapidly in the high-light period of Evergrande, and successively served as the general manager and assistant to the president of the brand management center of the group, the chairman of Jilin Company, the chairman of Shenzhen Company, and the CEO of the real estate group. His promotion speed is not surprising.
Many people who are familiar with Ke told CBN that Ke was highly valued by his boss because of his quick thinking and strong ability. This is evidenced by his appointment as the president of Shenzhen Company in 216.
in p>216, Evergrande moved its headquarters from Guangzhou to Shenzhen. At that time, Shenzhen's property market reversed from the downturn in 214 and 215, and it became the Depth Charge of a new round of real estate rising cycle, while the old cities all over Shenzhen were in full swing. Kemou led Evergrande Shenzhen Company to make great efforts in this hot land. In this year, Evergrande put forward the plan of real estate group returning to A shares, and achieved contract sales of 373.37 billion yuan by the end of the year, up by 85.4%, ranking first in the industry.
at this time, Evergrande is in full swing, cooking oil with great fire. Even though there are only a few projects in Shenzhen, outsiders can see how important the position of the president of Shenzhen Company is under the boss's nose. Since then, Evergrande Pearl River Delta Company, which was originally managed by Xu Jiayin's second son, has also been included in Ke's jurisdiction.
In October, 22, Ke Mou took the place of Da Litao and became the president of Evergrande Real Estate Group, standing at the peak of the workplace. At that time, he had just passed the age of no doubt.
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Old transformation of Shenzhen
For many years, Evergrande's main battlefield was not in the first-tier cities, so the project reserve of the group in Shenzhen was not much. Therefore, when Ke became the president of Shenzhen Company, his first task was to get the project. Now, looking back at Evergrande's achievements in Shenzhen for many years, it is not in the open bidding and auction market, but in urban renewal.
when Evergrande disclosed its annual results in 218, it revealed that it had reserved 45 old renovation projects in Shenzhen, with a planned construction area of 29.3 million square meters. By the annual report in 221, the number of Shenzhen old reform projects officially announced by the group has been further upgraded to 55, of which about 21 have been promoted to the project establishment stage.
A person familiar with Shenzhen's old reform market told CBN that the promotion cycle of an old reform project is roughly as follows: negotiation with the owner, government project establishment, special planning, demolition, land premium payment, formal development and construction, and sales.
project approval is a key link, which indicates that the project has been recognized by relevant departments and basically established the main body of development. Generally, there are publicity information for old projects. Prior to this, the negotiation stage with the owner was an early agreement, such as the pre-service agreement signed with the village collective.
compared with this old improvement, half of the projects signed by Evergrande in Shenzhen are still in the early stage. According to publicly available information statistics, about seven old renovation projects have completed planning, established the main body of implementation and the name of the project, and are in the stage of completion or construction, most of which are projects signed by Ke before his performance.
According to an insider, during his nearly five years in Shenzhen, Ke Mou mainly signed a bunch of contracts. Considering the long cycle and complicated procedures of the old reform project, it is normal to change the operation into one project within ten years. Therefore, there are very few projects that are actually changed and realized cash return under his command.
even so, the capital market has been excited about Evergrande's project reserves in Shenzhen. In the publicly available performance report or press release of Evergrande from 217 to 219, the Shenzhen project reserve with an estimated value of 4 billion to 5 billion yuan was once the highlight of the group's main publicity and a high-quality "asset" bearing the company's stock price valuation.
according to the traditional development line people inside Evergrande, the main achievement of Ke Mou during his stay in Shenzhen was that he signed some early old reform contracts, and his contribution to the company was not outstanding. If the sales amount is taken as the measure of regional contribution, the contribution of Shenzhen Company is really lacking, but Kemou's position in the group is only rising but not falling. Even when he became the president of the real estate group in 22, there were many voices of surprise inside, because the real estate development business accounted for more than 9% of the performance of China Evergrande for many years, but Kemou's practical experience in development and sales was slightly insufficient among the presidents of the first-tier regions or cities of Evergrande.
What is the ability of a financing general
that makes Ke be favored by his boss and his position has been promoted to the center repeatedly? What made him the first Evergrande executive to be taken away for investigation?
According to people familiar with the matter, it may be related to financing, whether it was highly valued before or it is now in deep trouble. According to reports, during Ke's tenure as the president of Shenzhen Company, Shenzhen Company's "money" ranked first in the group almost every year, with an average amount of 3 billion to 4 billion. This means that Kemou may get tens of billions of funds from various financial institutions every year with dozens of old contracts. Some of these funds were obtained in the name of old reform, and some were obtained by means of asset mortgage.
According to people familiar with Shenzhen's old reform process, financial institutions provide financial services for old reform projects, but they are generally cautious. They are not enthusiastic about participating in industrial reform and commercial reform projects, but they are more interested in the transformation of old villages. People in the mature industry all say that the purpose of the funds before the old reform project is mainly to pay the relocation compensation and project funds to the relocated villagers, and there are two necessary preconditions for obtaining the financing support from financial institutions. First, the developer can only seek financing from financial institutions after reaching an initial agreement with the relevant institutions in the demolished village, and the demolition, compensation and other programs are approved by the relevant institutions of the village Committee, and the project establishment and special planning are officially approved by the relevant departments. Under normal circumstances, the financing funds before the old reform need to be earmarked, for example, you can only enter the zero-relocation compensation account.
another person who has run the old renovation project also told CBN that according to relevant policies, financial institutions can provide some early special loans for the old renovation, mainly to pay the compensation for demolition. When the real estate market was booming in the early days, some banks were more enthusiastic about financing the old reform projects. It is reported that the financing funds before the old reform range from hundreds of millions to billions, mainly depending on the volume of the project.
according to the people familiar with the old reform process, it is unrealistic to get financing at the early stage of negotiation with the owners or villagers, but it is possible after the project is established. Some financial institutions will provide pre-financing funds at this stage, with high cost, up to 2%. "Strictly speaking, it is illegal for financial institutions to provide financing at this stage. It is very risky to wander in the gray area and play the edge ball."
among the 55 old renovation projects announced by Evergrande in 221, 21 projects have been approved for public inquiry, of which only a few are in the construction stage, and most of the others have not completed the special planning or entered the demolition compensation stage. Then, how do you get tens of billions of financing for limited projects, do you need tens of billions of funds to operate, and where do these funds flow? This may be the biggest mystery surrounding Evergrande Shenzhen Company.
A person from a financial institution who once had a cooperative relationship with Ke Mou revealed to CBN that there are many financing methods for Evergrande, including the pre-financing of old renovation projects and the pledge of fixed assets, because the old renovation projects acquired by the company include assets such as factories and office buildings, which can be used for pledged loans.
an insider of Evergrande revealed that there are not many projects under construction in Shenzhen, and there are not many sales rebates. Every year, it raises tens of billions of dollars, and it is borrowed from the new and returned to the old every year. Now, a lot of this money is still not paid, so it is easy to go back to the formalities.
where did the money go?
according to the 221 annual report disclosed by China Evergrande, there are five listed companies registered in Shenzhen: Qianhai Junlin Industrial Development Co., Ltd., Shenzhen Hongteng Investment Management Co., Ltd., Jiantao Digital Development Co., Ltd., Shenzhen Wanjing Investment Co., Ltd. and Shenzhen Yongheng Real Estate Co., Ltd. Among them, the first four companies all appear in the list of the main implementers of the old reform projects that Evergrande has established.
without exception, the enterprise investigation data shows that each of the five companies contains different amounts of judicial risks. Take Haijunlin Industry as an example, the company involved 67 judicial risk warnings, including financial loan contract disputes, trust disputes, housing sales contract disputes and so on. Wanjing Investment contains 62 risk warnings, involving bill disputes and contract disputes.
The lawsuit of Eternal Home Purchase mentioned above involves a private lending dispute. A judgment of the Luohu court in July 221 showed that the appellant Shenzhen UnionPay Bao Financing Guarantee Co., Ltd. appealed against the previous civil ruling of the Luohu court because of a private lending dispute with the appellee Shenzhen Yihua Jewelry Co., Ltd. and Yongheng Real Estate. In the court's opinion in the ruling of appeal jurisdiction, Luohu Court said that after the court's review, the case was a private lending dispute.
However, the above-mentioned court ruling did not specify the amount, purpose and specific occurrence time of the private loan involved in the lawsuit. In April 22, the equity of Eternal Real Estate was pledged to a trust company in the north, and the pledge is still valid. However, CBN failed to know the number of pledged shares of Eternal Real Estate and the pledgor.
in junlin industry, a compensation lawsuit for demolition occurred. According to a judgment of Shenzhen Nanshan Court in 216, Shenzhen Jinhong Xincheng Investment Co., Ltd. filed a lawsuit with the court, demanding that Qianhai Junlin Industrial Co., Ltd. and Evergrande Real Estate Group Co., Ltd. pay the plaintiff about 3 million yuan in demolition compensation and liquidated damages.
in the tens of billions of capital transactions of Evergrande Shenzhen Company every year, the 3 million capital involved in this case is only a fraction. The question is, if the financing money before the old reform is mainly used for demolition compensation, why is the compensation of 3 million yuan in arrears? Where do tens of billions of financing funds go every year?
The above-mentioned financial person who has worked with Ke Mou revealed: "When the money enters their company account, there is no way to trace it. I don't know where it is used. Anyway, it is still not available now. I just have a few mortgage projects in my hand, so I should not lose all."
insiders of Evergrande analyzed that the funds are usually allocated by the group in a unified way, and most of them are used to pay off debts. Especially since 22, the Group is determined to change the past high-leverage development model, and a lot of funds have been transferred to pay off debts. At that time, most suppliers' payments were suspended internally, and other departments could hardly get any money except the incentive commission for new financing and the expenses of marketing outlets.
according to the data available for corroboration, the interest-bearing liabilities of Evergrande decreased from a high of 874.3 billion yuan at the end of 22 to 674 billion yuan, and then to about 57 billion yuan in the middle of 221. At the same time, the balance of accounts payable and bills rose from about 54 billion at the end of 219 to nearly 67 billion in mid-221.
The huge financing of high praise and high loans once supported the rapid growth of Evergrande, but the huge financing cost has also become the main inducement to bring down the company. In the most beautiful period of Evergrande from 216 to 219, the company's total interest-bearing loans climbed from more than 5 billion to more than 8 billion, and the company's average borrowing cost for many years was above 8%, which means that the company's annual interest expenses are as high as tens of billions.
For example, in 219, when the company's total interest-bearing debt was the highest, the interest expenses disclosed in the annual report totaled about 68.5 billion. In this year, Evergrande achieved a total contract sales amount of more than 6 billion, but the profit attributable to shareholders was only 17.28 billion.
An insider of Evergrande lamented that the boss paid too much attention to financing and gave high rewards. Xia Moujun, the former group president who was in charge of overseas financing, and Ke Mou, who had been operating in Shenzhen for many years, were all good at getting money.
On July 22nd, 222, China Evergrande Group and Evergrande Property Company jointly issued an announcement, saying that according to the preliminary investigation results of Independent Investigation Committee, 13.4 billion yuan of deposits in Evergrande Property Company's account were forcibly transferred by the bank, and the preliminary results were obtained, and Xia Moujun, executive director and chief executive officer of China Evergrande Group, Pan Mourong, executive director and chief financial officer of Evergrande Group, and Ke Mou, chief executive officer of subsidiaries, were directly responsible for this matter. In this regard, the board of directors of China Evergrande Group decided to resign from the relevant positions held by the three of them.