Chapter 1380: Asset Sale
Gulf Oil's 38.6% stake was bought by Pacific Oil for a total of 4 billion US dollars.
It would have been less than 4 billion US dollars, but Xia Yu didn't mind the extra millions and rounded it up.
Of course, the funds came entirely from the Galaxy Fund.
After all, Pacific Oil is not under the ownership of any consortium, so naturally it will not touch the funds in the banks.
Moreover, the funds required to take over the assets of the Mellon consortium this time are huge, and those are the funds that need to be supplemented by banks.
Although major banks have previously mobilised a lot of funds to support financial companies to do more pounds, yen and stock markets around the world.
However, after the old Mellon fell ill, Xia Yu ordered various financial companies to make changes and find other external banks to allocate a portion of the funds, so that their major banks could raise funds.
In this way, they only needed to pay a portion of the margin and pay interest to be able to use the funds of other banks without the need for actual collateral, which was the most convenient and efficient method.
The only price to pay was that some of the long positions would be exposed and subject to the supervision of other banks.
However, considering the general trend of the global financial environment, the Mellon family would be long anyway, so exposing some of the positions did not matter.
After obtaining the 4 billion US dollars, the Mellon family's available funds exceeded 10 billion US dollars.
This time, the Mellon family had a lot more backing.
In contrast to their previous stance of backing down, they frequently attacked in the capital market.
Their targets were the shares of the Bank of New York, the National Bank of Pittsburgh, and General Reinsurance.
And the Mellon family was completely unreasonable in their extravagance, offering three times the premium, or five times if that wasn't enough, and doubling the price if someone else tried to snatch it away.
They were determined to get it!
Many of the original shareholders fell under the Mellon family's dollar offensive.
There was nothing they could do, they were just giving too much!
Meanwhile, the Mellon family was constantly resupplying ammunition and selling off assets.
Xia Yu did not reveal his relationship with the Polaris consortium, only stating that he was an ally. As for how the Mellon family would speculate, that was their business.
Since Polaris Capital acquired Wells Fargo, Wells Fargo has never stopped mergers and acquisitions.
And the targets of mergers and acquisitions are not those banks that are difficult to acquire, but rather the bottom line, targeting those community retail banks in various states.
The influence of these banks is limited to each state, and their deposits mainly come from residents. Due to their lack of strength, they lack high-yield investment channels, so they have assets but not impressive annual operating profits.
With Polaris Capital behind it, and later Xia Yu, Wells Fargo simply does not have a problem with having money to spend.
Therefore, Wells Fargo's acquisition of community banks has been fierce.
In just a few years, Wells Fargo has become a well-deserved major US bank through continuous mergers and acquisitions.
How aggressive is it?
In five years, it has acquired 57 local community banks!
The bank's assets are the third largest in the United States, exceeding $100 billion!
It is more than Chase Manhattan Bank and J.P. Morgan Guarantee Trust Company of New York.
In terms of assets, it is second only to Citibank and Bank of America!
The total deposits of its depositors have also exceeded 100 billion US dollars, more than Citibank and only a few billion US dollars less than Bank of America.
Next to Wells Fargo are the Canadian Toronto-Dominion Bank, the US Northern Trust Bank and East West Bank.
Together, these three banks and Wells Fargo have bank assets of up to 200 billion US dollars.
Therefore, although the liquidity of the Polaris Consortium may not be comparable to the Rockefeller Consortium, which owns hundreds of financial companies, it is also comparable to the First Citibank Consortium.
With so much capital in hand, it was a breeze to acquire the assets of the Mellon financial group.
210 million US dollars to take over 22.4% of the shares of the well-known American pharmacy chain, which later became the second largest pharmacy chain in the United States, Rite Aid.
570 million US dollars to take over 19.3% of the shares of the large American pharmaceutical retail and health insurance services company, Burgan Brunswig. This company was the core enterprise of the California consortium and had previously been infiltrated by the Mellon financial group.
140 million dollars for a 22.8% stake in the large generic drug company Mylan, which went public in 1973. This company is now just emerging as the second largest generic drug company in the world.
220 million dollars for an 18.7% stake in Comcast, the largest cable TV, broadband network and IP telephony provider in Pennsylvania.
1.07 billion US dollars to take over 15.7% of the shares in Suncor Energy Inc. This company, founded 99 years ago, is a conglomerate that is involved in a number of industries, including chemicals, coal and real estate, as well as being the second largest base oil services company and third largest engine oil manufacturer in the US. In 1980, it acquired Texas Pacific Oil for 2.3 billion US dollars, and in 1984 it entered the Chinese market and established a joint venture with Sinopec to form Sinopec Suncor Energy Inc.
390 million US dollars to buy a 14.2% stake in Hershey's, North America's largest chocolate and confectionery company.
320 million US dollars to buy a 16.1% stake in the famous American Heinz company, a century-old company in the field of nutritional foods, which was later fully acquired by Warren Buffett and 3G Capital for 28 billion US dollars.
He also owns 13.7% of Air Products and Chemicals, 16.3% of PPG Industries and 24.2% of Crown Holdings.
These three companies are major players in the industrial gas and coatings, coatings and specialty materials and glass fibre, and industrial packaging and equipment sectors respectively.
In addition, he owns 12.2% of PPL Corporation (Pennsylvania Power & Light) and 11.7% of Lincoln National Group in the financial sector.
These six companies cost a total of 1.19 billion US dollars.
None of these companies are core companies of the Mellon consortium, and they are assets of value investment.
Of course, it is not impossible that the Mellon consortium has the intention of merging with these companies in the future.
Unfortunately, with the arrival of this crisis, the Mellon family had to give up these plans that have not yet been implemented.
They chose to sell the shares of these companies and received 4.11 billion US dollars to replenish their capital.
In addition to selling off the equity assets of value investment, the Mellon family also sold 70.4% of the equity of the 15th largest US Navy shipyard in Philadelphia to Wells Fargo for $1.03 billion.
As for the other Pennsylvania shipyard, which is the 10th largest in the United States, the Mellon family retained 33.4% of the equity and sold 31.7% to Wells Fargo for $600 million.
Leaving this stake behind proves that the Mellon family has not given up hope, but Xia Yu is also happy with this.
In this way, the Pennsylvania Shipyard has the North Star Consortium and the Mellon Consortium behind it.
With the combined strength of the two consortia, it will be much easier to compete for orders for warships and submarines from the US Navy. It may not be impossible for the Pennsylvania Shipyard to break into the top five in a few years.
As for the steel sector, the Mellon Consortium has sold off its assets across the board.
The wholly-owned Wheeling-Pittsburgh Steel Corporation was sold for 3.1 billion US dollars.
90.4% of Allegheny Ludlum Industries, which was extremely famous in the field of special steel, was sold for 2.84 billion US dollars.
33.5% of Armco Steel was sold for 1.61 billion US dollars.
34.7% of National Steel was sold for 1.25 billion US dollars.
The four companies were sold for a total of 8.8 billion US dollars.
Together with other assets sold, the Mellon consortium took a total of 14.54 billion US dollars from the Polaris consortium.
After a series of intensive transactions, the Mellon consortium's liquidity suddenly exceeded 30 billion US dollars, and it was suddenly full of confidence.
It was only because it took over these four steel companies that the Polaris consortium had just started a fight with the Cleveland consortium!