When they learned that Li Yi was actually planning to invest in the Green Brothers Company—and intended to acquire 20 million shares in one fell swoop—everyone, including Zhou Xinghua, Lan Xinyi, and Cai Bingyan, was stunned.
Setting aside the immense risk involved, simply securing the massive sum of 600 to 700 million dollars was a major problem in itself.
After all, Li Yi had poured nearly all their money into the gold short-selling scheme; currently, their total available funds amounted to less than 20 million US dollars.
Moreover, this money wasn’t readily accessible, as Li Yi had also invested it in various stocks listed on the NASDAQ.
“Boss, are you really going to invest in Green Brothers?” Lan Xinyi asked.
“Yes, we’ve reached a preliminary agreement. Barring any surprises, we’ll sign the share transfer agreement within this week!” Li Yi replied.
“But… but we don’t have that much money,” Lan Xinyi said.
“This acquisition will be secured by our profits from the futures market, along with Mr. Green’s guarantee. We don’t need to pay the purchase price upfront—we just need to transfer the funds to them within two months!” Li Yi explained.
“But… aren’t they worried we might lose money?” Cai Bingyan asked.
“So what if we do? If they don’t get their money, the contract automatically becomes void, and we’ll have to pay them a penalty. In the end, the only ones who lose out are us!” Li Yi said.
“Even so, they’re being a bit too trusting. Do they really believe we won’t default?” Cai Bingyan asked.
“Haha, it’s not that they’re being overconfident—it’s just that this price is too tempting for them!” Li Yi said casually.
Green Brothers’ stock was indeed trading around $32 per share—Reggie Green hadn’t lied about that—but what he hadn’t mentioned was that the price wasn’t very stable.
Although $32 per share wasn’t the all-time high for Green Brothers’ stock, it was definitely the highest it had been in the past two years.
Especially now, with the Federal Reserve raising interest rates, the stock market here had been affected as well. The share prices of major companies were all falling, and Green Brothers was naturally no exception.
And this is only the second round of rate hikes; by the time the third—or even a potential fourth or fifth—round comes around, one can only imagine how much the stock price will have plummeted.
More importantly, for any publicly traded company, a major shareholder selling off shares to cash out will trigger a plunge in the stock price—the only difference is the magnitude of the drop.
If a key executive like Davis were to publicly sell off his shares, it would inevitably cause the company’s stock price to plummet. Therefore, no matter what they do, it will be difficult for them to sell at the high price of $32.
So, selling the shares this way at this point is truly a win-win.
“Boss, that may be true, but the terms they’re offering are simply too generous. We wouldn’t have to spend a single penny to acquire such a large stake in the company. Could this… could this be a trap?” Lan Xinyi cautioned.
Li Yi’s lips curled slightly upward. He gave Lan Xinyi a satisfied look and said with a smile, “Xinyi, your sense of caution is still quite sharp!”
“I just know there’s no such thing as a free lunch!” Lan Xinyi said.
“That’s exactly the right mindset!”
Then Li Yi changed the subject abruptly, making a startling remark: “That’s right. The Green Brothers Company is indeed facing bankruptcy right now, which is why they’ve had no choice but to seek outside help!”
As a future titan of the investment world, Li Yi was well-versed in the Green Brothers Company’s history. On its path to the top, the company had faced four bankruptcy crises.
The first crisis occurred during the Great Depression of 1929. When the stock market crashed, Green Brothers, like nearly every other publicly traded company, was dealt a devastating blow.
The second crisis occurred in 1973, when the company suffered massive losses from interest rate bets, triggering a chain reaction that nearly wiped it out!
The third crisis occurred in the 1980s, primarily due to major internal disagreements and severe internal strife. Although this crisis was eventually quelled by outside intervention, it ultimately led to the company being acquired by American Express, resulting in the loss of its operational autonomy.
The fourth bankruptcy crisis occurred in 1994, when the newly independent Green Brothers faced a cash crunch and a wave of debt defaults. This sparked investor panic, sent the stock price plummeting, and brought the company to the brink of bankruptcy.
Now that Reggie Green has sought me out, it suggests the company is currently facing its third bankruptcy crisis, and the rift between Reggie Green and Davis is clearly not as trivial as he makes it out to be.
If things hadn’t truly reached a point where a clean break was necessary, why would Reggie Green have put up his own assets as collateral for him?
Li Yi saw this through clearly, but since he had his own ulterior motives, he chose not to call him out on it.
“Boss, since you know they’re facing such serious problems, why would you still…”
Before Lan Xinyi could finish, Li Yi cut her off and said, “Because I need the Green Brothers Company. If they weren’t facing such a severe crisis right now, we wouldn’t have a chance to acquire their shares!”
At that moment, Zhou Xinghua suddenly spoke up: “Mr. Li, the price they’re asking is a bit inflated. If we negotiate hard, we could knock at least ten percent off—maybe even more!”
“No need,” Li Yi said coolly.
“???”
Seeing the puzzled expressions on everyone’s faces, Li Yi offered no explanation. Instead, he said again, “Alright, I’ve got this figured out. Don’t worry about it. You all go back to your own business!”
With that, Li Yi stood up and left the hall, returning to his room, leaving Lan Xinyi, Zhou Xinghua, and the others in the living room staring at each other in bewilderment!
It wasn’t that Li Yi didn’t know the price was inflated, nor that he didn’t know he could negotiate a lower price, but he simply didn’t see the point!
Because… he never intended to pay that acquisition price in the first place!
That’s right—this time, he planned to make a killing without spending a dime!
Reggie Green wanted to make a killing by shorting gold while simultaneously resolving the company’s crisis.
Clearly, this guy wasn’t just after the money in his hands; he was also eyeing Li Yi’s investment acumen, hoping to kill two birds with one stone.
So it was entirely predictable that, once this equity deal was finalized, the guy would raise funds to go all-in on shorting gold.
His plan was cunning, but Li Yi wasn’t stupid. While Reggie Green wanted to use him to escape the crisis and make a fortune, Li Yi had his own ideas.
Li Yi knew exactly how lucrative shorting gold could be; a $200-per-ounce spread was enough to make any bold company a fortune.
More importantly, Green Brothers was a brokerage firm itself, so he could easily use 10x or even 20x leverage to short gold.
With Li Yi providing guidance on the sidelines, this venture was bound to be a massive success.
If executed well, the profit share from this single operation alone would be enough to offset the hundreds of millions in equity acquisition costs.
In other words, barring any unforeseen circumstances, he could very well acquire these shares in Green Brothers without spending a single penny.
It’s practically a free gift—why haggle over a few pennies? That’s just petty!