Sources of M & a funds: real estate enterprises can raise M & a funds in multiple ways, and some ways make the liquidity pressure of real estate enterprises practically controllable. This paper combs the past four large-scale M & A cases in the industry. The M & a party can use its own funds, creditor’s rights and equity financing to pay the M & a funds: 1) the M & a party’s own funds: when rongchuang M & A Wanda cultural tourism project asset package with 43.8 billion yuan, it uses internal resources to pay the consideration in three phases after signing the agreement; M & A with its own funds will bring greater liquidity pressure to the acquirer, and installment payment may alleviate the above pressure to a certain extent. 2) Third party loans: when R & F acquired Wanda Hotel asset package with 19 billion yuan, of which 6.3 billion yuan came from third-party loans; The pressure on the short-term liquidity of the acquirer to make joint payment and purchase with its own funds and loans is slightly less than that to make full use of its own funds, but it may further improve the leverage ratio. 3) M & a loan: in the case of Vanke’s acquisition of Guangxin asset package, Vanke replaced the original investment of about 25 billion yuan through M & a loan; It should be noted that the issuance of M & A loans should meet certain conditions. 4) Issuance of perpetual bonds: when Evergrande acquired Chow Tai Fook and Shanghai New World Co.Ltd(600628) 5 projects with RMB 20.4 billion, Evergrande issued a total of US $1.5 billion of perpetual bonds to Chow Tai Fook and Shanghai New World Co.Ltd(600628) and paid nearly half of the acquisition consideration; Perpetual bonds will be included in minority shareholders’ equity, and Evergrande has also successfully optimized its capital structure while carrying out M & A. 5) Issuance of shares: when CNOOC acquired CITIC asset package with RMB 31 billion, HK $29.7 billion was paid by issuing shares to CITIC (about 24.9 billion yuan) CITIC also became the second largest shareholder of CNOOC after acquiring shares. 6) project transfer: the payment method of the remaining consideration in the case of CNOOC’s acquisition of CITIC asset package is to transfer the property portfolio to CITIC. CNOOC has not used other self owned funds, and the impact of this acquisition on its own liquidity is relatively small.
M & a progress: some large-scale M & A transactions are completed within half a year after both parties sign the agreement. The remaining problems of the M & a object may affect the M & a progress. Some large-scale M & A transactions were completed within half a year after the announcement of the acquirer, such as the sale of Wanda cultural tourism and hotel assets, Evergrande’s acquisition of Chow Tai Fook and Shanghai New World Co.Ltd(600628) 5 projects, CNOOC’s acquisition of CITIC asset package, etc. On the other hand, the historical problems of some assets have affected the progress of project development, partner introduction and application for M & A loans. For example, due to the complex problems involved in Guangxin asset package, Vanke completed the introduction of war investment and the replacement of M & A loans three years after winning the asset package, and the first project of the asset package was opened for pre-sale nearly four years later. Similar to Guangxin asset package, the old transformation projects of some real estate enterprises may also be difficult to transfer or slow to merge and purchase.
The policy encourages high-quality real estate enterprises to carry out project mergers and acquisitions, and the land storage layout of jiazhaoye, huaxiangnian and other real estate enterprises in danger is relatively better. Recently, the Financial Times reported that the regulators will encourage the issuance of M & A loans, focus on supporting high-quality real estate enterprises to acquire high-quality projects of out of danger real estate enterprises, and the resolution of industrial risks is expected to move forward steadily. From the land reserve layout of six real estate enterprises that have defaulted or are seeking cashing schemes and have disclosed the distribution of soil storage projects in the middle of 2021: 1) urban energy level: according to the energy level division standard of 70 cities by the Bureau of statistics, Jiazhaoye’s land storage and construction area in the first tier cities is significantly ahead (23.6%), with outstanding advantages; Xinli, huaxiangnian and Fuli second tier cities account for a relatively high proportion (51.1%, 43.2%, 41.0%). 2) regional distribution: among the six companies, 63.1% of jiazhaoye’s soil storage and construction surface is located in the Pearl River Delta, and 29.5% and 28.3% of Xinli and Aoyuan are located in the Pearl River Delta respectively; the proportion of Xinli and huaxiangnian’s soil storage and construction surface in the Yangtze River Delta is relatively high, about 21.5% and 17.3% respectively. 3) heavy warehouse cities: among the top ten cities in front of huaxiangnian and jiazhaoye’s soil storage and construction There are relatively many hot cities. For example, the land storage and construction area in Chengdu, Foshan, Shenzhen, Ningbo, Hangzhou and other places accounted for a relatively high proportion in Huaxiang year, and jiazhaoye has more layout in Shenzhen, Guangzhou, Dongguan and other cities. On the whole, jiazhaoye, huaxiangnian and other land reserves have a relatively better layout, and may be relatively smooth in terms of sales collection or asset sales.
Risk warning: there is uncertainty in the control policy and epidemic prevention and control policy; The company’s sales receipts may fluctuate
