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Extraordinary Genius
Chapter 1307 – Shocking news during the closing ceremony
The two weeks beer festival has come to an end, and today is the closing ceremony. After the closing ceremony, the exhibition halls and booths will be demolished.
Of course, the demolition and material costs have all been recovered.
Zhang Ruiqiang stood on the stage to give the closing speech. He thanked lots of people, companies, and departments who had contributed to this festival.
When everyone thought Zhang Ruiqiang’s speech is ending, he made an announcement. “There is another good news to announce today. Bing City Beer and Tai Hua Holdings will be swapping shares with Budweiser, and they will be cooperating on production, sales, technologies, management, and several other areas…”
Wa~~~~
All the breweries in the audience were stunned.
Bing City Beer will be cooperating with Budweiser? How are they going to cooperate, and what has Tai Hua Holdings got to do with it?
Many people among the audience quickly take out their mobile phones to contact their headquarters. They must inform their company immediately.
Bing City Beer is China’s first brewery and the market leader of the three Provinces in the Northeast. The other is the world’s no.1 brewery.
This cooperation will change China’s beer industry.
Snow’s representative quickly reported this information to his company. Snow must speed up their expansion. They are not afraid of Budweiser, but everything changed when Tai Hua Holding is involved.
That is Feng Yu’s company, and they have strong financial backing. If they decided to expand, they would be Snow’s direct competitors.
Feng Yu is too scary, and no one has ever heard he had failed to acquire any company. Also, none of his investments had failed. Bing City Beer is going to succeed!
Qingdao Beer’s representative had also relayed the news back. They had planned to enter the Northeastern market as the three northeast Provinces have the highest beer consumption in China. Just look at the number of breweries there. Almost every city has a brewery.
If Bing City Beer is cooperating with Budweiser, then they will become much stronger. It will not be easy to enter the northeastern markets. Qingdao Beer must relook into their strategies and make changes.
Beijing Beer is the most worried. Bing City Beer is already the market leader in the Northeast, and Snow is expanding from Shenyang towards the north. Qingdao Beer has also entered the Beijing market, and Beijing Beer is facing the highest threat.
Once Bing City Beer starts to expand towards the south, Beijing will be the first to be targeted.
Beijing Beer’s market is only in one Province and two cities. If so many breweries are entering their turf, it will be hard for them to maintain their market share, and they might not survive.
Overseas beer brands’ representatives from Heineken, Carlsberg, Singha, etc., are also troubled. They had been suppressing Budweiser in the Chinese market, and it will be impossible after this cooperation is formed.
But they are not very worried as Bing City Beer’s positioning is different from them, especially Heineken and Carlsberg, who are targeting the high-end market.
Those foreign breweries, who planned to set up factories in China, are also troubled. China already has lots of top foreign beer brands, and Budweiser is cooperating with China’s oldest brewery. Heineken and Carlsberg will surely implement measures against Budweiser.
Mortals will suffer when the gods fight. These small breweries are in trouble.
Regardless of branding, popularity, or funds, they are way behind these few international top breweries. If they also enter the war, they will be the first to die.
But this cooperation gave these foreign breweries an idea. They can also seek cooperation with Chinese breweries. They just need to work with a Province’s market leader and slowly expand from there. With their experience, it should not be a problem to secure a province market.
On the day the announcement was made, Bing City Beer’s share prices shot up by 7%, and at night, which is US’s day time, Budweiser’s share prices raised by 5%.
Almost all investors felt the cooperation between these two breweries would benefit both parties.
Everyone is curious about the conditions in this cooperation.
The next day, both companies suspended trading because of their cooperation.
Other foreign breweries also started to contact the Chinese beer brands. But they realized Tai Hua Holdings has already invested or own the controlling stake in several breweries.
Although the shares are not swapped, the agreement had been signed, and Tai Hua Holdings has prepared the funds.
Everyone realized that they could not stop Bing City Beer and Budweiser from expanding in China after Tai Hua Holdings got involved.
…….
“Feng Yu, you are quite fast.” Zhang Ruiqiang laughed.
“If I am slower, I will need to use more funds. If those breweries know we will expand, they will raise their demands, and Snow will also compete. When that happens, we will have to spend much more.” Feng Yu explains.
“Let me remind you that the annual production of top global breweries is at least millions of tons.”
Zhang Ruiqiang gave Feng Yu an unhappy stare. “Can’t you let me be happy for a while more?”
“Alright. Just treat it as I have not said anything.”
Zhang Ruiqiang: “……” You had said it!
“Oh, do Beidacang and Bing City Government object to Bing City Beer’s plan to issue new shares?” Feng Yu asked.
“No. This is an opportunity to expand, and they will not miss it. The private placement we promised you is also not a problem.”
“Good. After getting the shares of these few breweries, Bing City Beer’s assets should double. We will be exporting our beer to western countries and other regions. Our Bing City Beer is going to be famous worldwide. Oh, have you all decided about letting Bing City Beer becoming one of the sponsors for the 2008 Olympic Games? It will be great for beer sales and marketing.”
“I had informed my men. But you had raised the benchmark for sponsorship, and we need to spend a lot more. “Zhang Ruiqiang grumbled.
“The money will still go to our country, and those foreign companies need to spend more for the sponsorship. This will greatly benefit us. Alright. I need to hurry home. My wife is due soon.”