EPTwww.teamliquid.net/blogs/viewblog.php?topic_id=393480
Sometime in 2008
I first met Zhang Shenghan at the wedding between Patricia Kwok and her second fiance. I remember it like a movie, and--were it one--I would have been a bit player to advance the plot. There were plenty of cameras on hand, mainly because a flock of migratory hacks had landed a week ahead of the Olympic Torch, and Patricia had eloped from her first fiance in favor of a tall, lanky English diplomat. If it bleeds, it leads--and nothing bleeds like a broken heart.
Even though it was nearing May in Hong Kong, the weather felt cool, a Venetian breeze lapping at my freshly shaven face. We stood under these white outdoor tents laden with champagne and chocolate-covered fruit, waiting for the music to start. Some Apple Daily reporter did his best impersonation of a whirling dervish, his camera trying to capture three hundred and sixty degrees of excess. I hoped I didn't stand out. My tuxedo was a rental, and there was the small issue of a briefcase handcuffed to my left wrist. "Not your right," Anson, the bespectacled secretary to Patricia's widowed mother, had told me. "You want to be able to shake hands with guys twice your age as naturally as any other young man. You want to be forgettable."
Utterly forgettable, because being remembered was not my job that day. "Your job is to deliver the contents of the briefcase--several contracts--to Patricia, and have her sign them our special Board meeting can begin." My phone buzzed. Anson, ever helpful, had sent me a photo of Patty Kwok. The picture included the blue contact lenses she got the prior month.
Elton and James, her two brothers, were entertaining the other directors on the nominal 58th floor, empty because none of the other numerology-obsessed directors wanted their offices there. (If you didn't skip over the 4th, 13th, 14th, 24th, and 40th to 49th floors, that would be the 44th floor of the building.) Elton and James didn't care about those numbers. They were the new generation--one Kellogg, one Fuqua--and the only numbers they cared about were either locked in a safe thirty meters underneath the Bank of China building, or chained to my wrist.
They ranged from 00000001 to 99000000, and denoted the relative ownership of the Class B shares of one of the largest and most lucrative conglomerates south of Victoria Harbor. There were about one hundred million of them in total.
What are Class B shares, you might ask?
Let's say that you've devoted your life to setting up an enterprise for the big time, like elder Kwok did. Somewhere over the horizon, massed like the Persians at the Dardanelles, are the waves of hot money, just itching to find a way into every single vaguely profitable, quarter-baked idea being pitched by someone who isn't White and Protestant. They call this "seeking hidden returns in emerging markets". The investment bankers across the table from you know this, and that's why, under their Hermes and fitted Armani, they're grinning like John Kerry's wife on Botox.
1997 hasn't happened yet, the mainland and the WTO haven't finished their little dance yet, so you're the only fucking game in town. Of course, the Nikkei's still hurting, but really, all that did was keep those poor Nipponese banks benched on the sidelines. And just in case the trust fund kiddies ever wised up and wondered where all their money was going, they even came up with a nice, sanitized name for you--"Asia ex-Japan". "Opportunity, ex-the-one-time-we-got-it-wrong," land of hopes and dreams, the Wild Wild East.
But back to you. You're seasoned, you're a pro. You know dumb money when you see it, no matter what language it speaks. You'll take their checks, easy, no problem.
But there's one catch. With normal equity, they can buy control. Take over enough of your public shares, and you might end up having to kiss asses every single month in board meetings. That's intolerable. Not only would that be annoying, but they'll have their hands on your company. Your baby. Your raison d'etre, your magnum fucking opus. No way.
You're just about to tell off the investment bankers at the other end of the table when one of them, a little cleverer than the rest, says the magic words. Class B. Create Class B shares with ten times the voting power of Class A shares, restrict the buying list to yourself, and voila, you can get the best of both worlds. All that gweilo captial, going straight into your pocket, but you'll retain 85% of the voting power in your firm.
So you go ahead and sign on the dotted line. It's the first time you've signed your name in English. You phone your loyal secretary Anson, ask him if he can come up for a moment, and when he comes out, he becomes the owner of a cool million Class B shares. You finish giving yourself the other ninety-nine million, and then you die.
For most people, death is a round, firm, period, but if you're rich, death becomes a squirrely semicolon, followed by the endless terms that make up a professionally drafted will. If you're rich, and your relatives are also selfish assholes, death becomes a comma, running on and on until one side can no longer pay its legal bills.
Old Man Kwok left behind a question mark. Seven businesses--two hotels; a real estate developer; a bankrupt brokerage house; a shipping line; a chemicals company; a media conglomerate. Three descendants--two legitimate, ungrateful, sons who split the yacht and the apartment--and one illegitimate, beloved, daughter to whom he bequath his actual legacy. Cue a collective 'hak diu' through the Hong Kong grapevine, and panicked phone calls over the hotline from Governor's House to Zhongnanhai.
It was the media chunk Party Central wanted. Elton and James could keep the other pieces. The capos had passed a new dictate: if you wrote in Chinese, you could write whatever you wanted, but at the end of the day, your editors had to belong to the Party.
The first attempt was a fiasco. Intrusions into a Skadden Arps database failed to locate all the electronic copies of the will. On top of that, our 'window washer' slipped off the fog-slicked seventeenth floor of the Cheung Kong building, impaling himself on a streetlight. In spite of our efforts, Patricia got her Class B shares.
Then we played nice, and got another strike. Six weeks before the wedding, the Bank of China, through a Cayman Islands intermediary, approached Patty Kwok with close to two billion dollars. She gave them the finger, then proudly announced she would give the media assets to her English diplomat fiance. Zhongnanhai was not amused.
Upper management then decided to use the Luca Brasi approach. First, the Bank of China lowered its offer by eighty percent, to just over four hundred million. The middlemen were replaced with Patty's own two brothers. They would take the four hundred million, buy the company at the ridiculously low price from their sister, and then slice the Kwok empire into pieces for public consumption at fair market value. Then, the Bank of China would offer close to a billion for just the media conglomerate--which Elton and James would bundle with the bankrupt investment brokerage to further discourage competing bids.
Finally, yours truly would kindly inform Patty that either her signature--or her brains--would be layered on the dotted-line contracts in my briefcase. I was going to do it before her husband could have a say in the decision.
One more minor detail: Patricia was a nympho on the level of Taylor Swift. The gun to her head was a fourteen-year-old Filipino boy the triad girls affectionately dubbed Ma Gor, or "Horse Brother". The age of consent in Hong Kong was sixteen, and our asset was willing to testify.
I ducked past a throng of cheongsam-clad office ladies, glanced at the photos on my phone. In the first, Patty and her boy toy were still clothed. By the fifth, she was riding cowgirl. I grinned. Then a warm hand on my shoulder turned me around.
"Your racehorse won't make it." A smiling gentleman, weight resting casually on one foot, cologne and vermouth and whiskey on his breath, an old-fashioned gold pen in his left hand. His right let go of my shoulder and extended into a handshake.
"Zhang Shenghan. You must be the gambler with the lucky streak."
I nodded, mumbling something. Cold sweat slicked my palm. Shenghan felt it on his hand, grinned, then went on. "But your luck's run out. Listen, kid, they're fishing him out of Victoria Harbor right now. Unfortunately for you, that means he can't run at the races next month."
Another sip of the Manhattan. I stood, numb.
"The house won't be happy with the bets you've made. But I can fix that for you, if you put me on the line with the brothers and your man inside."
I put him on the line to Anson. Shenghan kept one hand on my shoulder while he spoke. "The horse drowned, but I made a tape of the jockey having an accident with him at the docks... How much? I want the chemicals firm at the four hundred million valuation... deal." Then he hung up and pressed the pen into the USB port. "The movie should be on your phone. You've got thirty minutes until they exchange vows. Now go give Patricia Kwok her Oscar for Best Actress."
Patricia Kwok wound up signing over the shares for only two hundred million dollars.
Read part 9 here:
http://www.teamliquid.net/blogs/viewblog.php?topic_id=394307
