Chapter 773: Charging headlong into the crocodile pit

The location of Bridgewater Associates.

When Xia Yu arrived, Ray Dalio was adjusting the division of labour within the fund.

The acquisition of IBM's shares had already been completed, Xia Yu's task had been completed, and the temporary acquisition team naturally had to be disbanded, and the personnel transferred back to their respective positions.

Xia Yu did not disturb them, nodded to him, and went to the office to drink tea and wait.

After about five minutes, Rey Dario walked in quickly with a file folder.

'Boss, I'm sorry to keep you waiting. This is the proof of IBM's equity and the transaction contract,'

Rey Dario said, handing the file folder to Xia Yu, then sat down opposite Xia Yu, poured himself a cup of tea, and waited quietly.

Xia Yu opened the file folder, took out the contents, and quietly leafed through them.

IBM's stock accounts for 3.01% of the company's total share capital. Apart from a small portion acquired from the market, the rest was acquired from six small shareholders, at a total cost of 1.109 billion US dollars.

This shareholding percentage has already placed it in the ranks of the top ten shareholders of IBM on paper, ranking eighth.

IBM was listed in 1917, and it has been 63 years since then.

Over such a long period of time, IBM's shares have been traded back and forth countless times, not to mention the fact that in these 63 years, IBM has also successively merged and acquired many companies, many of which were in the form of cash plus shares, further dispersing the shares.

Today, there are only three major shareholders with more than 5% of the company's shares: Morgan Stanley, General Dynamics, and Bank of America.

Morgan Stanley needs no introduction; it is the core pillar of the Morgan consortium. As for General Dynamics, it is an aviation engine and arms manufacturer and also a core pillar of the Morgan consortium. Finally, Bank of America is the core of the California consortium, which is now heavily infiltrated by the Morgan consortium and is almost in the same boat as the Morgan consortium.

As for other minority shareholders, many of them are also companies in the Morgan camp.

So in fact, IBM belongs to the Morgan camp.

The reason Xia Yu wanted to acquire more than 3% of the equity ratio was actually for a seat on the board of directors of IBM.

Generally speaking, whether it is a listed company or an unlisted company, a major shareholder with a shareholding ratio of more than 5% can be guaranteed a seat on the board of directors.

However, in the case of listed companies, considering the dispersed ownership of listed companies, the threshold has been lowered to allow shareholders with a shareholding ratio of more than 3% to enter the board of directors.

But note that this is only allowed!

It is only a qualification!

Whether or not they can enter depends on whether the shareholders' meeting agrees.

Shareholders who individually or jointly hold more than 3% of the shares can propose a motion to the shareholders' meeting and apply for the right to recommend directors.

Then, if the shareholders' meeting approves, the shareholders with the right to do so can recommend directors to the board of directors, which will consider the recommendation and then submit it back to the shareholders' meeting for consideration before it takes effect.

This is the normal procedure for recommending directors.

Of course, there are also extremely special circumstances, such as the current shareholding situation of IBM.

IBM has been listed for too long and its shares are too widely spread, so there are very few major shareholders with a stake of more than 5%. If there are only a few directors, the stock exchange will worry that the company is at high risk, after all, with a small board, any decision can be passed more easily.

So in this case, there is another rule, which is that the top ten shareholders of a listed company can enter the board of directors.

That is why Xia Yu wanted to break into the top ten shareholders.

And the reason for acquiring more than 3% of the shares is also to have an additional insurance policy.

After all, when the time comes and he has entered the top ten shareholders, he will have pushed the original tenth shareholder down.

The original tenth largest shareholder already has a seat on the board, but if they suddenly lose it and are unwilling to accept this, they could temporarily increase their shareholding and overtake him.

So even if the original tenth largest shareholder is unwilling to increase their shareholding again, Xia Yu, who is in eighth place, still has some room for manoeuvre, and it is even more secure. Three percent is enough to enter the board of directors, so it is not necessary to use the clause that requires being in the top ten shareholders to enter the board of directors.

After reading it, Xia Yu put it back in the file bag with satisfaction, saying, 'Well done, Lei, you've worked hard.'

Lei Dario smiled and shook his head, "It's not hard work, it's what I should do.'

Xia Yu nodded slightly and instructed, "I'll have Peter Lynch come over later, and you will transfer all the shares to the name of Polaris Capital.'

Lei Dario nodded in response, 'Okay.'

Xia Yu took a sip of tea and said after a moment's thought: 'Rey, I will invest another 200 million US dollars in the company in the next two days. You should make the investment according to the situation.'

Rey Dario was suddenly surprised and said with a smile: 'Okay, thank you boss!'

He thought to himself, it was indeed not a waste of time this month, not only had the boss generously left the profits as they should be, but he had also invested another 200 million US dollars.

As long as the funds were in place, the strength of Bridgewater Fund would instantly soar by a large margin, and he would have even more room for investment.

Seeing Ray Dalio's happy face, Xia Yu nodded with a smile.

Afterwards, Xia Yu left and went to Polaris Capital, asking Peter Lynch to go to Bridgewater Associates and take over the equity. This process requires the company's seal and other steps, so Xia Yu did not do it himself.

The two previous acquisitions of Bridgewater Associates were not reported to the exchange in time, so the name of Bridgewater Associates is not among the top ten shareholders of IBM.

However, when the equity was transferred to Polaris Capital and Polaris Capital reported it to the stock exchange, IBM's equity information was immediately updated.

After all, it is now the largest company on the New York Stock Exchange and the company with the highest market value in the United States. Countless pairs of eyes have been watching it for a long time, and any slight change will attract countless attentions.

When IBM's equity information was updated, the unfamiliar Polaris Capital immediately became a hot topic in the dark, and major financial companies were doing their best to find out information about Polaris Capital.

Financial companies that can come up with US$1.1 billion at once are very rare, and they must be very strong, and they can be considered crocodiles.

When a crocodile rushes into the crocodile pool, the other crocodiles naturally want to find out more about it and see what attitude to adopt towards it!

Warren Buffett was no exception. When he saw the name Polaris Capital, he was shocked and secretly amazed. Xia Yu had indeed not lied to him. Polaris Capital was indeed very powerful, and it had spent more than 1.1 billion US dollars to purchase equity in IBM at one time.

In an instant, a feeling of relief rose in Warren Buffett's heart. Fortunately, Xia Yu had not moved against Berkshire Hathaway, otherwise, the 1.1 billion US dollars in capital would definitely have caused him the biggest trouble in his life.

Fortunately, everything is now going in the right direction. Polaris Capital has entered the board of directors of Berkshire Hathaway and become his ally. Having such a powerful ally is of great benefit to Berkshire Hathaway.

All major financial companies know about it, and so does IBM, as the party concerned. The current CEO, Frank T. Cary, hurriedly inquired about the news to find out what was going on.

While Frank T. Cary was investigating, Xia Yu had already set off with his men for the headquarters of IBM in Armonk, New York.

For the sake of the plan that followed, Xia Yu had to enter the board of directors of IBM and become a director of IBM.