Chapter 386: Dancing on the Edge of a Knife
"Lai Zong." Li Tang arrived at the headquarters of Hua Aluminum Group and met with Lai Xiangrong.
The headquarters of Hua Aluminum Group were now situated in Yanjing, so the distance he traveled wasn't far.
Currently, the group's main responsibilities and day-to-day affairs were largely handled by Lü Caiqing.
Although Lai Xiangrong hadn't officially retired, he no longer handled substantial responsibilities, merely coming into the office daily, sitting for a while, and drinking tea—quite leisurely indeed.
"You are such a busy man—it's truly difficult to meet with you," Lai Xiangrong said, putting down his newspaper and standing up to sit in the reception area, inviting Li Tang to join him for tea.
Lü Caiqing accepted a cup of tea brewed by Lai Xiangrong's secretary, Xiao Wang, and personally poured it, commenting, "Careful, it's still hot."
Li Tang smiled, nodding his thanks, put down his teacup, and looked up at Lai Xiangrong with a smile. "The construction project at the Malihe Iron Mine has encountered some troubles, so the year didn't start smoothly."
Li Tang made some casual conversation.
He had always maintained a good impression of the Hua Aluminum Group—formerly known as Huazhou Aluminum Factory—mostly due to Lai Xiangrong's presence.
Whenever possible, he considered involving Hua Aluminum Group in joint projects, believing that their involvement, along with Lai Xiangrong's influence, would greatly benefit the projects.
Pulling Hua Aluminum Group into the investment with Gala Aluminum Group was precisely his intention.
With the involvement of giants like Hua Aluminum Group and Huaxin Taifu, securing trust from Jiangda Securities was straightforward, and necessary loans were easily obtainable.
"I came today for serious business. Let's discuss the important things first, and then we can catch up later," Li Tang said, sitting upright, becoming serious.
"I'm not in charge anymore. If it's official business, I'll just listen in," Lai Xiangrong replied, sipping tea leisurely.
Li Tang nodded without further comment and went straight to the point. "Our investment in Gala Aluminum Group's stock has yielded considerable results."
"The current returns far exceed my expectations!" Lü Caiqing interjected, amazed.
Even though Lai Xiangrong was no longer directly involved, Lü Caiqing always reported significant events to him. Regarding the Gala Aluminum Group investment, he regularly updated Lai. Currently, their book profit had exceeded eight hundred million USD.
In just a few short months, this investment had become wildly profitable.
Naturally, Lai Xiangrong was aware of this situation. Holding his teacup, he looked meaningfully at Li Tang. "You might not know this, but when you first proposed investing in Gala Aluminum Group, I personally opposed the idea. After all, I didn't understand the foreign investment environment, nor did I know Gala Aluminum's true operational state—whether it was shiny on the outside but rotten within, or genuinely promising. I was uncertain and therefore wary."
He expressed his thoughts candidly, unafraid of appearing uninformed.
He glanced approvingly at Lü Caiqing, saying, "At that time, Caiqing was determined to follow your lead, investing three hundred million USD of our group's own funds into this risky venture! I know he faced enormous pressure over the past few months. He shouldered everything himself."
Hearing these words, Lü Caiqing felt moved and proud. "Without Lai Zong's backing and support, I couldn't have managed such pressure. Lai Zong, you are the eternal spiritual leader of Hua Aluminum Group!"
"I'm an old man, conservative in thinking, sometimes stubborn. For Hua Aluminum Group to expand internationally and compete against mining giants, we must rely on vigorous young people like you."
Lai Xiangrong praised Lü Caiqing, then turned toward Li Tang with a warm smile. "Since Caiqing insisted on investing in your proposed project, I could only support him. Of course, I'm retiring soon and can't take charge, but since I'm about to retire, relieving the decades-long pressure on my shoulders, I've understood something clearly."
"What's that?" Li Tang immediately responded.
"I understood something very important: trusting your judgment and investing alongside you is unquestionably correct!"
Lai Xiangrong pointed at Li Tang, eyes filled with fondness and satisfaction. "With you leading our mining ventures overseas, I firmly believe we'll achieve significant success!"
"Lai Zong, you're putting a lot of pressure on me," Li Tang laughed. "I can only handle minor, achievable tasks. Important matters concerning national interests and industry development still require your strategic guidance!"
"I'm not just being polite. I mean what I said!"
Lai Xiangrong set down his tea, gazed intently into Li Tang's eyes, and spoke earnestly. "We have a good relationship, and although I'm retiring, my feelings toward Hua Aluminum Group won't change. I hope under Caiqing's leadership, the group continues to flourish and fulfill the tasks set by higher authorities. Hua Aluminum Group must eventually enter the international stage because domestically, with annual alumina production in the millions of tons, we've run out of rivals. The only path left for further growth and contribution to national economic development is going global!"
These words affirmed Hua Aluminum Group's growth trajectory and expressed hope for its future.
However, sharing such heartfelt thoughts with Li Tang clearly indicated other intentions.
"Li Tang, nobody in our country understands the international mining market better than you."
He had devoted his lifetime to Hua Aluminum Group, and even approaching retirement, he remained deeply concerned. "Can you assist our Hua Aluminum Group?"
Li Tang was hesitant to accept such a significant request. "Who am I to give Hua Aluminum Group advice? If anything, it's Hua Aluminum that's helping me. I'm just an individual, and my capabilities are limited."
"You're too modest! The whole world knows that Li Tang from Huaxia has become a dominant figure in the global mining market—a dragon rising when encountering water!"
Lai Xiangrong feigned annoyance, "If we Huaxia people fail to recognize your significance and leadership in the industry, we must all be blind!"
"Lai Zong, you flatter me," Li Tang smiled awkwardly but didn't refuse outright. "If needed, Hua Aluminum Group can contact me anytime. I'll do my best to help."
Lai Xiangrong knew not to demand too much; this promise reassured him sufficiently.
"I'm getting old and repetitive. My grandson often teases me, calling me a tape recorder because I repeat the same topic endlessly," Lai Xiangrong chuckled, waving his hand. "Continue your business talk. Where were we?"
Lü Caiqing quickly replied, "We were discussing the Gala Aluminum stock investment. We invested three hundred million USD for a 28.5% stake. With Li Tang's leadership, leveraging financial instruments, we mobilized three billion USD, acquiring approximately 12% of Gala Aluminum Group's shares, plus convertible bonds."
"It's a huge and risky investment!" Lai Xiangrong exclaimed, tapping his chest. "My old heart couldn't withstand it—only bold young people like you could pull off such a brilliant investment victory!"
Feeling enthusiastic and cheerful, he added, "Fantastic! You've brought glory to our mining and investment communities! Now, international capital and mining circles will never underestimate us again!"
"Our investment genuinely shocked Wall Street's financial giants," Lü Caiqing added admiringly. "Many foreign financial analysts and economists regularly analyze our case, admiring our impeccable timing."
"This successful investment entirely depends on Li Tang's keen insight, decisive actions, and astonishing courage! Hua Aluminum Group greatly benefited by investing alongside Li Tang," Lü Caiqing continued.
Li Tang recognized Lü Caiqing's intentions clearly from his praise. They focused solely on investment returns, lacking other strategic considerations.
This differed from Li Tang's objective, which extended beyond mere profit.
This was precisely why he'd come to speak face-to-face with Lai Xiangrong and Lü Caiqing today. Transparency in such major cooperation was essential; internal suspicion could lead to disastrous outcomes.
Now, they needed unified objectives.
"Our investment has high returns. Especially our initial two billion USD investment, which outperformed most stock funds."
Li Tang bluntly addressed the matter. "Are you thinking this might be the best time to sell and cash out?"
"You don't want to cash out?" Lü Caiqing asked.
Everyone believed Gala Aluminum's stock price, nearing eighty USD, significantly exceeded its intrinsic value—a bubble destined to burst.
"Cashing out now could indeed yield substantial profits," Li Tang admitted. Purely from an investment perspective, this seemed an excellent exit point.
However, with knowledge from the future about Gala Aluminum's fate, he knew the optimal timing hadn't arrived yet.
Changing his tone, he continued, "I came today precisely to inform you: not only will we not cash out now—we'll invest even more!"
"Huh?" Lai Xiangrong looked up in surprise, raising his eyebrows sharply.
"This seems overly risky," Lü Caiqing expressed confusion.
"I want to increase our holdings to 14%," Li Tang explained calmly.
"You intend to influence Gala Aluminum's acquisition outcome?" Lü Caiqing's confusion deepened.
Such actions were risky, potentially creating powerful enemies internationally.
It was an operation akin to dancing on the knife's edge!
Everyone believed Magnesium-Aluminum Group had already made all necessary preparations, determined to swallow up Gala Aluminum Group and reclaim their status as the world's number one in the aluminum industry!
Last year, two major acquisitions by Russian Aluminum had propelled it to the number-one spot, likely causing dissatisfaction within Magnesium-Aluminum Group. Sometimes, these mining giants would lavish huge amounts of money merely to reclaim face.
"Exactly," Lü Caiqing acknowledged. He was obviously aware of the situation. "Currently, most people are optimistic about Magnesium-Aluminum Group completing this acquisition."
"Even if Gala Aluminum's board accepts Magnesium-Aluminum Group's bid, there remains another significant obstacle: antitrust investigations from Magnesium and Gala's home countries," Lai Xiangrong reminded them cautiously. "There are still many uncertainties regarding this merger! Thus, we shouldn't automatically assume the stocks we hold will yield maximum profit. In investing, the key isn't how much money you make or the highest rate of return, but about safeguarding your capital. Avoid being excessively greedy!"
Undoubtedly, Lai Xiangrong was sending a clear warning to Li Tang.
Li Tang understood Lai Xiangrong and Lü Caiqing's concerns but realized they misunderstood his intentions. They assumed he was greedy and intent on maximizing profit. However, Li Tang had other plans entirely.
"Everyone thinks Magnesium-Aluminum Group will definitely acquire Gala Aluminum Group, though rejection is also possible," he spoke calmly and clearly. "In fact, some individuals have realized a possibility exists for a surprise takeover bid amid this historically significant merger."
"A surprise takeover?"
"Which company?"
"Rinto, Saltwater Sea Valley, and Strandt have all publicly indicated they're closely monitoring the Magnesium-Aluminum and Gala Aluminum merger," Li Tang replied without directly pinpointing Rinto but broadly expressing his ideas. "I believe a surprise bid is likely!"
"Why?" Lü Caiqing, always attentive to global aluminum industry movements, had received no indication or substantial evidence regarding a potential surprise bid.
"Gala Aluminum, as the world's third-largest aluminum company, previously pursued aggressive global expansion, acquiring businesses and establishing offices in over a hundred countries. A giant like Gala becoming prey is an incredibly rare opportunity. For other mining giants, missing this chance means it might never come again."
Li Tang's analysis carried conviction, strongly supporting his speculation.
"Which company do you think is most likely to act?"
"In the early 2000s, Strandt was merely a mid-sized mining company with a market value of $2 billion. They've achieved significant growth through mergers and diversified expansions. However, they've just completed a $16 billion cash acquisition of Fuller Company. They're still repaying loans and under substantial financial pressure."
By saying this, Li Tang effectively ruled out Strandt.
"Saltwater Sea Valley surged to the top of the mining industry due to the booming iron ore market. They've also pursued diversified investments in copper, aluminum, and gold mining sectors, but these ventures have remained relatively modest."
Li Tang lacked concrete evidence regarding Saltwater Sea Valley's determination but concluded, "They're very interested in Gala Aluminum, but I'm unsure whether they have the resolve to commit over $30 billion."
"What about Rinto?" Lü Caiqing asked.
"Rinto is undoubtedly the strongest potential surprise bidder!"
Li Tang's statement was unequivocal. "Currently ranked seventh globally in aluminum, Rinto's aluminum division generates significant financial returns. Their alumina production alone accounts for 9% of the global market!"
"Yes, Rinto has investments or acquisitions in major bauxite-producing countries such as Australia, Gala, and Guinea," Lai Xiangrong, as Hua Aluminum Group's general manager, kept a close eye on key competitors.
Considering the current global aluminum industry hierarchy, Russian Aluminum, Magnesium-Aluminum Group, and Gala Aluminum Group were clearly in the top tier. Hua Aluminum Group was ranked fourth—a position it owed to Huaxia's immense production and consumer market. However, their influence internationally was negligible.
Despite being a globally recognized large-scale enterprise, their isolation domestically was frustrating—akin to being trapped in a small room, unable to expand their massive structure. Thus, recently they were actively pursuing international expansion.
Hence, Lai Xiangrong's honorable retirement was approaching, allowing the more adventurous Lü Caiqing to soon assume leadership.
Following Lai Xiangrong's thoughts, Li Tang continued, "Rinto excels in bauxite mining and alumina production, holding substantial market share, dominating the upstream sector. Gala Aluminum, however, is weaker in upstream activities but globally leading in primary aluminum smelting, aluminum products processing, and distribution networks, with unparalleled technologies in premium hard aluminum sheet manufacturing and worldwide market dominance."
By now, Lai Xiangrong and Lü Caiqing clearly grasped Li Tang's analytical perspective.
"You believe if Rinto acquires Gala Aluminum, they'll complement each other's strengths and weaknesses?" Lü Caiqing asked.
"Exactly!" Li Tang affirmed decisively. "Magnesium-Aluminum and Gala Aluminum both focus on downstream markets, creating clear conflicts. Their merger would simply increase scale and monopolistic power. Conversely, if Rinto acquires Gala Aluminum, it immediately achieves comprehensive integration from upstream aluminum production to high-end downstream markets, offering end-to-end industry services."
"Hmm," Lai Xiangrong nodded in agreement.
"I believe Rinto has both compelling reasons and sufficient capital to execute this historic acquisition," Li Tang concluded his extensive analysis.
"So, you think Rinto's chances of acquiring Gala Aluminum exceed Magnesium-Aluminum's?" Lü Caiqing asked bluntly.
Without hesitation, Li Tang nodded. "Yes, I strongly believe Rinto will succeed!"
"Phew—" Lü Caiqing exhaled deeply upon hearing this unexpected analysis and conclusion, clearly diverging from previous assessments. Hua Aluminum had invested $300 million, extensively analyzing Gala Aluminum's potential acquisition scenarios to navigate market trends and avoid investment risks.
Lai Xiangrong was deeply shaken by Li Tang's insights, taking a big gulp from his tea and exclaiming emotionally, "The whole world acknowledges your exceptional talent in mining exploration and development, yet your investment predictions also demonstrate extraordinary insight!"
While Lü Caiqing admired Li Tang's bold analysis, internally, he was more concerned about the direct implications for Hua Aluminum Group.
Presently, there was no indication Rinto would take action, nor did anyone anticipate it. However, now they had to include Rinto in their strategic considerations.
"If Rinto joins this acquisition, is it beneficial or harmful for us?"
"The benefits outweigh the risks!" Li Tang's response was unequivocal, differing fundamentally from others. "For Rinto to execute a surprise takeover, defeating Magnesium-Aluminum Group and successfully acquiring Gala Aluminum, they'll inevitably need to offer a higher bid, otherwise Gala's shareholders have no incentive to accept. Being major shareholders, we naturally prefer maximum returns."
"You mentioned raising our stake to a 14% threshold earlier—what's your intention?" Lü Caiqing recalled Li Tang's previous emphasis, seeking clarity behind his deeper motives.
"Extortion!" Li Tang bluntly used a rough word, openly revealing his intentions to Lai Xiangrong and Lü Caiqing, now trusted allies. He felt secure enough to speak candidly.
Seeing their startled expressions, he elaborated, "Rinto owns several extremely valuable assets, such as multiple high-quality iron ore mines in Australia! With a 14% stake in Gala Aluminum, we'd have veto power over major shareholder decisions, using that as leverage to demand valuable mining assets in exchange for our approval!"
It was a bold, almost ruthless strategy.
"What if Rinto refuses?" Lü Caiqing asked immediately.
"If they refuse our terms, they'll have to abandon their Gala Aluminum acquisition!" Li Tang wasn't overly worried. "If Rinto genuinely commits over $30 billion for a hostile takeover, they're determined to succeed at all costs. Any resistance wouldn't deter them. Hence, I'm confident they'll comply."
"It's very risky!" Lai Xiangrong, known for his cautiousness, instinctively emphasized potential dangers.
"This is a fierce battle in capital markets!" Li Tang's ambitious gaze revealed his true intentions. "We must make Rinto suffer heavy losses!"
Secretly, he harbored even more ruthless ambitions he didn't disclose, envisioning thoroughly exploiting Rinto in the future.
"What if we fail completely?" Lai Xiangrong challenged.
Lü Caiqing quickly responded, "Both sides would suffer significant losses."
"We must increase our leverage again to reach our target stake," Li Tang declared. He turned directly to them, "Do you agree?"
Acquiring more Gala Aluminum shares now involved high costs and substantial risk.
Lai Xiangrong took another sip of tea, spit out the tea leaves impatiently, and remained silent. Clearly, the elderly and nearly-retired Lai was reluctant to gamble or complicate matters.
Thus, Lü Caiqing would again shoulder all responsibility. Understanding this clearly, Lü Caiqing did not hesitate. He knew if he were timid, he wouldn't be replacing Lai Xiangrong as Hua Aluminum Group's leader!
"If we succeed, will we acquire substantial funding and potentially an excellent iron mine?" Lü asked finally.
"Absolutely!" Li Tang confirmed. "An excellent iron mine is worth far more than hundreds of millions in cash!"
After lengthy contemplation, Lü Caiqing turned cautiously toward Lai Xiangrong, asking, "Lai Zong, shall we follow Li Tang's lead again?"
"Hmm," Lai Xiangrong responded softly, ambiguously—perhaps approval or merely appreciation for the tea.
Interpreting this positively, Lü Caiqing decisively affirmed to Li Tang, "I support your decision!"
Meanwhile, across the ocean, Magnesium-Aluminum Group launched another bid, offering $28 billion—again rejected fiercely by Gala Aluminum's shareholders.
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