Chapter 78

Chapter 78 Private is a bit scandalous

At the Hilton family party, senior executives of the giant.

In fact, they were in preliminary negotiations with Abel about subscribing to Smith Capital's first private placement.

At that time, the negotiations were generally resolved.

Only then did the Manhattan District Attorney's Office begin investigating Smith Capital.

This decision has raised doubts about the capital's hyenas, which have a very keen sense of smell. Over the next few days, none of those who agreed came to the door.

But on the contrary, this hyena's sense of smell is really sensitive.

Caroline appeared that day and said this after the Manhattan District Attorney's Office concluded its investigation into Smith Capital.

That night, someone came looking for David Mellon.

After seeking instructions from Abel, David met with Mellon Bank executives at Smith Capital headquarters the next day. Mellon Bank is also known as Mellon Financial Group.

Yes, David's ancestors were the founders and owners of this bank.

However, after hundreds of years, David and his family still own a small share of Mellon Financial Group.

But just a little.

Mellon Financial Group and David Mellon, now we can just say that they have some connection. But it is precisely such origins that prompted Mellon Financial Group to end cooperation with Smith Capital as soon as possible.

Subscribe to a certain portion of a private equity fund.

Then Goldman Sachs, Lehman and other companies also came to the door one after another, before Charlie Schaff arrived today.

There isn't much left in Smith Capital's first private placement.

If Merrill Lynch is not a giant, Abel still wants to get something from Merrill Lynch next. Merrill Lynch won't even get a portion of that 500 million, because too many people want it.

After all, there isn't much else in New York, but there are certainly a lot of rich people.

Abel, the Wolf of Wall Street, has been endorsed by newspapers such as the New York Times and the Wall Street Post.

This time it was "certified" by the Manhattan District Attorney's Office.

There are too many rich locals trying to sign up to get a fraction. To ensure safety, they will not buy too much.

But just like when Peter Lynch and Buffett first emerged.

When profits are significant.

Even when it comes to taking risks, rich people are still willing to take chances.

Therefore, as part of the division, three billion US dollars in private placements. registered.

Merrill Lynch could receive up to 500 million. This is because Abel wants to get resources from Merrill Lynch.

will leave those shares behind as part of the deal with Merrill Lynch.

Hearing Abel's words, Charlie Schaff cursed "FXXK" in his heart. Actually, he also wanted to get to the door earlier.

But Merrill Lynch still has concerns.

After dispelling those worries, Charlie Schaff walked out the door.

But it's a bit late.

In recent years, Merrill Lynch has become increasingly conservative. Every year, the annual report is half dead, sometimes even unfinished.

With time and space, Merrill Lynch was finally unable to survive the 2008 subprime crisis.

It's just that Merrill Lynch's assets were very good and Bank of America agreed to take over the offer.

Unlike Lehman, too many people died.

In the end, he really died. Charlie Schaaf no longer hesitated, he said decisively: "No problem. What about the details of the contract?"

"啪~"

Abel snapped his fingers, David smiled and waited on the side, immediately bringing a stack of documents to Charlie Schaff.

"It's all here, sir." David smiled.

"THANK."

Charlie Scharf quickly took it and flipped it over quickly.

Charlie Scharf carefully inspected it and found the facade to be generally satisfactory. The registration fee and subsequent management fee are also quite satisfactory.

For example, the registration fee is 1%, which means a one-time registration fee of 1% must be paid, which is included in the price.

That is, if the registration is 1 million and the registration fee rate is 1%, you need to pay 1.01 million money.

Gift exchange fees are also normal. 2% is low by Wall Street standards. These are quite normal.

Management fee is too expensive.

Typically, the management fee is usually around 2.5-5% of the trust amount paid out each year.

For Smith Capital's private placement, the contract does not stipulate any management fees.

Nothing to complain about, not even 0.1%. But

The key lies in the commission fee of the bonus later.

This value is very high.

Dividend commission refers to the need to extract a certain amount of profit before distributing dividends, as an effective compensation for the manager.

These fees are collected only during the bonus redemption or bonus rollover period and they can be divided into three forms.

Extract a certain percentage of profit per project,

According to a certain percentage of all profits from the trust funds,

According to a certain percentage of excess profits are provided to investors in excess of income. This rate is usually around 10 to 40%.

10% is low, very little.

40% is high so very low.

But Abel's contract requires a dividend withdrawal fee that can be up to 50%.

It's a bit of a funny high. But if it wasn't scandalous enough, Charlie Scharf also saw it.

In this private placement, the actual contract closing time is only 180 days.

For fund managers, the longer the lock-up period, the better.

The maturity period for most private equity funds is closer to five years or more.

Longer years, even ten, fifteen or twenty years. Although short-lived, it usually lasts more than three years.

A 180-day closing period is almost unheard of in conventional large fundraising.

Seeing the end, Charlie Schaff swallowed hard and his throat moved.

He rearranged his language, looked at Abel with a relaxed expression and said softly:

"Sir, this contract is a bit excessive."

"The most extreme is this outrageous bonus and 180-day lock-in period that is very detrimental to you."

"Friend"

Charlie Schaaf was interrupted by Abel before he could finish speaking.

He said to David Mellon, "David, tell Mr. Schaff what Smith Capital's floating profit is from March to present."

"Forehead"

Here we go again, David thought. But this set is really easy to use.

David smiled and said: "That's 3.645 billion USD. Sir.

"So before that, how much was our principal amount?"

"That's $390 million."

"Very well, thank you David."

"Nothing."

Behind the double reed, Abel looked at Charlie Schaff again.

"Sir, I believe in these one hundred and eighty days.

Bring more profits to you. So this 50% salary is what I deserve. "

"And I also believe that after this short-term 180-day private placement ends.

You would think that paying me a 60% bonus commission would be worth it. "

"That's why I don't want any management fee, but the bonus fee is 50% and the lock-in period is only 180 days."

"Because after 180 days, this private placement will be complete.

When Smith Capital completed its second private placement, conditions were different again. "

"Do you understand now, sir?"

(end of this chapter)