Chapter 51 History of Corporate Characters: Yang Rong’s Sadness

The biggest news in China this year is "canned food for airplanes".Mou Zhong of the Nande Group exchanged 500 wagons worth 400 million yuan for daily necessities in exchange for 4 Suzhitu-154 aircraft. He claimed to have earned 80 million to 100 million yuan from it.While people were discussing this matter enthusiastically, 35-year-old Yang Rong sat on a big leather chair with a look of disdain.At that time, a capital operation project he had painstakingly planned was coming to an end, but in hindsight, it was indeed much more sophisticated and sophisticated than the "cans for airplanes" of bartering.

People don't know much about Yang Rong's life experience. His original name was Yang Yong, and he was born in Beiguo Town, Jiangyin City, Jiangsu Province. After graduating from junior high school, he worked as a chef for a while, and then contracted a small shop in his hometown, and then came to Jiangyin City I went to work in a foreign trade company, and later went to Shanghai to do stock trading.The Donghu Hotel in Shanghai was the base of the early speculators. The well-known people in Shanghai, such as Yang Wanwan, Liu Tai, Zhu Huanliang, etc., all set up their camps here. I made a little money, and at the same time experienced a lot of operational skills.In a certain month, he simply changed his name to Yang Rong, which probably means "relying on finance". In 1989, appreciated by Xu Wentong, a well-known financial educator and party secretary of the China Institute of Finance, Yang Rong went to Hong Kong to establish Huabo Finance Company. The initial investor was Hainan Huayin, where Xu served as the chairman.

Living in Hong Kong and caring about the mainland, Yang Rong is well aware that the capital reform of state-owned enterprises will bring huge profit space.Shenyang Jinbei Automobile is the first large-scale state-owned enterprise in Northeast China to try shareholding system reform. In 1988, it issued 100 million yuan of stocks at home and abroad. It took more than a year but received little response. The company even posted a notice in the compound of the State Economic Reform Commission Selling stocks, I only sold 27,000 yuan in a whole day.At this time, Yang Rong came to negotiate. On July 22, 1991, Yang Rong bought 40% of the shares of Jinbei Auto for US$12 million. After that, he arranged a key stock exchange to expand the holding ratio to 51% %, becoming the absolute controlling party of the company.For this purpose, Yang Rong set up a project company in Bermuda, a small island in the Pacific Ocean - Brilliance China Automobile Holdings Co., Ltd., which is 100% controlled by Huabo.At this time, Yang Rong also quietly completed the capital transformation of Huabo. Its shareholding structure was changed to Yang Rong accounting for 70%, another natural person accounting for 30%, and the legal representative was still Yang Rong.According to media disclosures in 2003, there are files showing that Yang Rong planned Brilliance's acquisition of Shenyang Jinbei, and all the cash he invested came from Hainan Huayin controlled by Xu Wentong.

After completing this series of long-sleeved capital portfolios, Yang Rong began to plan to list on the New York Stock Exchange in the United States.At that time, China had not established the China Securities Regulatory Commission, and all the operations of Yang Rong had no precedent.In order to allow listed companies to have a more legal and reasonable identity, Yang Rong planned to set up the non-profit "China Financial Education Foundation". The sponsors are the Education Department of the People's Bank of China, Brilliance Holdings, China Finance Institute and Hainan Huayin. Four companies, just like that, Yang Rong put on a prominent "red hat" with many monopoly state-owned capital backgrounds, which allowed this capital tycoon to benefit from the first and fall behind. In October 1992, "Brilliance China Automobile" was successfully listed in New York, raising US$72 million.This is the first overseas listing of a Chinese company.For the NYSE, it was also the first official listing from a socialist country.It was a sensation in the U.S. stock market that year.

Brilliance's IPO made Yang Rong famous. He soon realized that the auto industry he had stumbled into might be the most promising field in China.Since 1995, Yang Rong has taken over the management of Jinbei Bus as a major shareholder, and gradually shifted his energy to operating work.At that time, due to years of monopoly operation in the automobile industry, all major automobile manufacturers were bound to do so without much fighting spirit.When Yang Rong really entered, this strategist with a clear and keen view of the overall situation quickly became a headache "subversive".

The flagship product of Jinbei Company is the Hiace minibus. In this market, Changchun FAW's Jiefang van is a well-deserved "Little Overlord" and is in the limelight.Yang Rong mobilized all the best R&D personnel in the company to develop a new low-cost Hiace model specifically for the "Little Liberation".During this period, there was an anecdote that was very revealing of Yang Rong's temperament: Yang Rong once went to Changchun to visit Geng Zhaojie, Chairman of FAW, and Geng treated him with arrogance, and Yang Rong was not angry.After the new model of Sea Lion was designed, Yang Rong scrolled through the blueprints and went to Geng Zhaojie again, saying: "Once I sell this car, your little liberation will definitely fail. But I will definitely lose money when developing this car. I will produce it in a month." Five hundred units, with a discount of five thousand units a year, you will give me 10,000 yuan for each car, a total of 50 million yuan, and I will sell you the license of this model. I have notified you of this situation , and if you don't agree, I'll do it my way."

Geng Zhaojie had never seen such a person before, so he must have thought he was crazy.After the new Hiace was launched on the market, it was welcomed by users in small and medium-sized cities and towns because of its novel shape, low price, and flexible marketing methods. Only one year later, FAW’s small liberation turned from profit to loss, and after another two years, it was forced to withdraw compete. From the end of 1997, Yang Rong began to plan to introduce German technology and equipment to build a domestic car production line with an annual output of 100,000 vehicles. He proposed, "to manufacture Chinese cars with 100% intellectual property rights." The leaders shook their heads.

Yang Rong's car manufacturing is not like other entrepreneurs who follow the steps step by step.He is China's leading capital operation master, and his mind and structure are of course very comparable.He implements a dual-track parallel strategy in building his own brand. On the one hand, he cultivates core R&D capabilities through entrusted design and self-rolling accumulation.Brilliance invested 100 million yuan to jointly establish Tsinghua University Automotive Engineering Development Research Institute with Tsinghua University, with Yang Rong as the chairman; The company seeks cooperation in different forms and contents.He successively carried out extensive cooperation with five major international automobile companies including BMW, GM and Toyota, which Yang Rong proudly called "Five Golden Flowers".

Surrounded by the "Golden Flowers", the research and development of cars with independent property rights is no longer behind closed doors.In addition to building an industry and capital platform around automobiles, Yang Rong also made frequent moves and set foot in other fields. Under his strong operation, Brilliance spread out many branches like a big octopus. Around 2001, Yang Rong created a The Brilliance Group, with a market capitalization of 24.6 billion yuan, has 5 listed companies and 158 affiliated companies, of which 138 are holdings.Brilliance has 8 automobile production lines and more than 10 complete automobile and component factories, forming an unprecedented "finance-industry" integration system in China's automobile industry.In Yang Rong's plan, the future Brilliance will be under a financial holding company, forming three major sectors of automobiles, finance and infrastructure, among which automobiles will account for 80% of the total output value. By 2010, the production and sales of 1.5 million vehicles will be realized. Operating income of 200 billion yuan, profit of 20 billion yuan.Undoubtedly, if this goal is realized, Brilliance will become the largest automobile company in China.

In December 2000, the first generation of Zhonghua sedan rolled off the assembly line in Shenyang.At the grand off-line ceremony, Yang Rong excitedly held up a calligraphy of "China's No. It is I, Brilliance, who dare to challenge foreign companies." At this moment, Yang Rong is like a national car savior. Until the beginning of 2001, Yang Rong's career showed no signs of failure. In January, in recognition of the first Zhonghua car rolled off the production line, the Shenyang Municipal Government held a grand ceremony and awarded Yang Rong the title of "Honorary Citizen".Yang Rong announced the company's performance in 2000. Brilliance's after-tax profit was a record 1.8 billion yuan, second only to Shanghai Volkswagen and FAW-Volkswagen in the automotive industry. In March, a major earthquake occurred in the political circles of Shenyang. Mayor Mu Suixin and Executive Vice Mayor Ma Xiangdong were arrested for corruption.As the most well-known large enterprise in Shenyang, Brilliance has very close interactions with the government. The fall of the current leader will naturally affect Yang Rong's strategic thinking.It was at this sensitive moment that he began to negotiate with Rover, a famous British car company, planning to build a new car base in the south.

Rover is an old factory with a history of more than 100 years. Due to its slow growth, it has suffered a lot of losses in recent years and is eagerly looking for sellers around the world.The negotiation between Yang Rong and Rover quickly rose to a comprehensive joint venture. The cooperation methods proposed by Yang Rong include: after the joint venture, all products of Rover will be moved to China for production; Rover will maintain the existence of Rover’s British R&D center and European sales system, and the Among the products produced in China, those exported to Europe use the Rover brand, and those sold in China and the Asia-Pacific region use the Chinese brand; Rover helped Brilliance complete the engine upgrade and put the "Zhonghua" trademark on the engine. This is a long-awaited large-scale joint venture project, and it is the first time that Chinese entrepreneurs appear on the international mainstream business stage as integrators and rescuers.After entering the 21st century, the rising China began to show a more powerful force in the global economic competition. Some fast-growing large companies are trying to achieve cross-border development and industrial upgrading through mergers and cooperation. Brilliance and Rover’s The joint venture should be one of the earliest and most anticipated projects. Compared with Lenovo's acquisition of IBM's PC business unit and TCL's acquisition of Thomson TV in the future, Yang Rong's initiative and ambition seem to be greater.If this joint venture is successful, the territory of China's auto industry will be completely rewritten, and even the growth route may be changed dramatically.Its significance is no less than that of Brilliance's US listing ten years ago.After the relevant agreements were signed and finalized, Yang Rong made a decision that he regretted for the rest of his life.In the calculation of this excellent strategic architect, the moves are precise and tightly linked, and all the elements are perfectly prepared.It's a pity that he missed a seemingly unimportant point: the mentality of the Northeast. From the perspective of the Liaoning Provincial and Shenyang Municipal Governments, Yang Rong wanted to "slip away" this time.An investment bank analyst believes, "From the perspective of Liaoning Province and Shenyang City, Yang Rong's actions are like hollowing out Jinbei Automobile and letting Jinbei Automobile transfuse blood for his projects in other provinces." The details of the negotiations between the government and Yang Rong have never been made public, but the results of their communications are well known.The government hoped that Yang Rong would put the Rover project in Liaoning, and Bo Xilai, who was promoted from Secretary of the Dalian Municipal Party Committee to Governor of Liaoning Province at the beginning of the year, also proposed a "Dalian plan" in detail.Yang Rong insisted on building a factory in Ningbo, but he promised that Shenyang would still be Brilliance's bus base.Obviously, this was an answer that could not satisfy the government. In this way, the contradiction suddenly intensified in the autumn of 2001. See-saw negotiations broke down after the Spring Festival in 2002. On March 11, the Enterprise Department of the Ministry of Finance issued an official letter to transfer all Brilliance and its derived companies to the Liaoning Provincial People's Government at one time, and all debts were also transferred. lost".The receiving team immediately read the official letter to Yang Rong. Yang Rong continued to act with an uncompromising attitude. On March 21, Brilliance Automobile announced the news of a joint venture with Rover in the UK, invested 100 million yuan to buy the construction land in Ningbo, and paid Rover 15 million pounds for technology transfer at one time.A week later, the working group entered Shenyang Brilliance, and began a comprehensive inventory, verification, and acceptance of Brilliance assets.The two sides are tearing apart, and the break is irreparable. In May, Yang Rong flew to Wutai Mountain in Shanxi to pray and worship Buddha.Then he was admitted to Shanghai Ruijin Hospital.At the end of the month, he quietly went to the United States with a tourist passport and never returned. On June 18, the board of directors of Brilliance Automobile dismissed Yang Rong from his positions as chairman and president of the company on the grounds that he "improperly made business decisions that were contrary to the business policy of the foundation, and thus failed to take into account the collective interests of the company's shareholders." .The next day, the cooperation project proposal between Brilliance and BMW was approved at the State Council office meeting.And half a month ago, Zhonghua Car also entered the latest vehicle production catalogue, and was officially approved for mass production. On June 25, Yang Rong, who was in the United States, sold all of his Brilliance China stocks in the Hong Kong stock market, cashing out 89.68 million yuan.So far, the speculation that Yang Rong is out has been publicly confirmed. After Yang Rong left, the maze-like Brilliance Department could not be controlled by outsiders. Therefore, the most important task for Liaoning is to retain the backbone of the team.In the end, Yang Rong's four assistants, known as Brilliance's "Four King Kongs" by the outside world, all agreed to stay on. The retention of these four people made Yang Rong's solitary escape more like a farce of betrayal. On August 20, the launch ceremony of Zhonghua Sedan was grandly held in Beijing. The market price of the first Zhonghua standard model on the market was 169,800 yuan, making it the only mid-range domestic sedan that competed with international brands in the Chinese market.Brilliance announced that it will develop into an important domestic auto group in 5-10 years, with a target sales volume of 180,000-200,000 units within 5 years, and a sales revenue of 130 billion yuan by 2010, accounting for 10% of the Chinese auto market share.In the warm and festive scene, the splendid weather, and the presence of talented people, the protagonist who is of medium stature, has a voice like a bell, and always combs a shiny back hair should have appeared in the center of the spotlight to receive crowds and congratulations , but at this moment, alone on the other side of the ocean, I feel dejected. The fuse that caused the break was the termination of the Rover project in Ningbo as a matter of course.At that time, the demolition of the land had been completed, and the office building had begun to be used. The four prototypes improved by Rover had been basically completed. The new model was being exhibited in Geneva, and the improvement of the engine was in progress. The list of all production equipment shall be handed over to the Chinese side.When Su Qiang informed Rover and Ningbo on the grounds that "the project was wrongly established", he faced the astonished eyes and couldn't answer a reason for the explanation.In order to terminate the contract, Brilliance paid more than 200 million yuan in compensation. Yang Rong's entanglement with the government still has a few lingering lingering sounds. On October 14, Yang Rong sued the China Financial Education Development Foundation and the Ministry of Finance in the Beijing Higher People's Court through Hong Kong Huabo Finance Company on the grounds of asset misappropriation and administrative infringement. It is the property rights dispute involving the largest amount of money since the founding of New China.Yang Rong is the kind of person who is always setting records.In order to show his "legal selflessness", he even signed a power of attorney, announcing that he would donate all the legally recognized assets of Brilliance to non-profit social groups or charities. Four days later, the Liaoning Provincial Procuratorate issued an arrest warrant for suspected economic crimes, formally arresting Yang Rong. In November, the Beijing court ruled that Yang Rong's lawsuit was "unlitigable" and temporarily dismissed it.Yang Rong turned to sue Brilliance China Automobile in Bermuda, and sued the Liaoning Provincial Government in the U.S. Federal District Court of Columbia. In the end, they all failed because they were "out of jurisdiction".So far, the "savior" Yang Rong has completely failed and called a curtain call. On October 23, Wu Xiaoan, the new chairman of Brilliance, told reporters: "Mr. Yang Rong's participation in the management, operation and business of the group is negligible..." After Yang Rong left, Brilliance gradually declined.And Yang Rong himself had new reflections on the public case that year. In August 2005, Yang Rong said in an interview with the media: "I really didn't expect that putting the project in Ningbo would cause so many troubles... If it was put in Dalian, nothing would happen."