While reporters across Hong Kong were busy digging into Lin Baicheng's background, hoping to expose more information about him, he himself had already arrived in Japan.
On the second day after reaching Japan, Lin Baicheng and Haruko Mouri went to the manga publishing company to complete the equity transfer with all current shareholders. The company had multiple shareholders, but Haruko had already negotiated the price with each one—only the signing of the transfer contracts remained.
The manga publishing company, valued by the investigation firm at around 1.8 to 1.9 billion yen, was purchased by Lin Baicheng for 2.1 billion yen—less than a 20% premium, quite a reasonable figure. After all, the company only had operational issues—it wasn't bankrupt or on the verge of collapse—so a slight premium was normal.
Once the contracts were signed and payment was made, the company officially belonged to Lin Baicheng.
After the transaction was completed, all original shareholders left the meeting room, leaving only Lin Baicheng, Haruko Mouri, and a temporary lawyer they had hired.
"Haruko, when you send someone to register the company's ownership transfer, remember to change the company name to 'Zhiyin Manga Publishing Company.'"
"Yes, Chairman."
Haruko replied respectfully.
"As for the president of Zhiyin Manga—among the current three department heads, who do you think is most suitable for the role? Or… should we look outside and hire someone new to be president of the company?"
Lin asked. As his assistant, Haruko understood the company far better than he did. The information he had received from the investigative firm only covered valuation-related basics—it wasn't detailed.
Haruko didn't answer directly but instead said, "Chairman, the company has no issues with its manga publishing business. It's developing well and brings in considerable profits every year. All three department heads are capable. I think it's best if you meet them individually, hear their thoughts on the company's development, and then decide."
"Is that so? In that case, promoting internally is better—it prevents talent from leaving."
Lin nodded. But he still asked, puzzled, "Haruko, since this company is doing well in the manga business and earning good profits every year, then where exactly did things go wrong? According to the report, the former president and some shareholders made bad investments, which led them to sell the company. Will that affect our future development?"
"Chairman, I've already investigated everything."
Haruko explained, "In 1972, Prime Minister Tanaka proposed the 'Reconstruction of the Japanese Archipelago Plan.' Combined with loose financial policies at the time, land and housing prices skyrocketed between 1972 and 1974—at their peak, nearly doubling."
"However, there was a massive bubble. In 1975, the bubble began to burst, and prices started falling. For example, a 30-tsubo (about 100m²) apartment in central Tokyo that cost 20 million yen at its peak in 1974 now only costs 17 million—an average drop of 1 million yen per year."
"When housing prices were soaring, real estate was extremely profitable. Prices changed weekly and assets climbed non-stop."
"In this overheated atmosphere, many people entered the real estate market. Mr. Ogasawara and the other shareholders were among them—and they entered right near the peak."
"At that time, Mr. Ogasawara invested all his personal assets and also borrowed 2 billion yen from the bank in the company's name together with a few shareholders, using the funds to purchase real estate, expecting it to appreciate. Unfortunately, the 2 billion yen worth of property they bought is now only worth 1.7 billion yen."
"Not only that, because they used loans to buy real estate, the company still has to pay interest every year. Thankfully, the interest rate on the loan was low—only 6% annually, meaning 120 million yen in interest each year."
"The company's manga publishing business earns about 150 million yen annually—enough to cover the interest. But after paying staff salaries and other expenses, almost nothing is left."
"Afraid that real estate prices would keep falling, Mr. Ogasawara and the others held on for a few years but could no longer endure it—so they decided to sell the company."
"You said you believed in Japan's real estate potential and that we could borrow from banks to grow the company, so I chose this one."
After listening, Lin couldn't help but feel sorry for Ogasawara and the others. Their actions were exactly like retail investors in the stock market—buying at the peak, selling at the bottom. If they knew the full truth in a few years, they'd cough up blood from regret.
Lin didn't know whether land prices in Japan would fall further in the next year or two. But even if they did, he believed that after two to three years of decline, the downside was limited. Entering the real estate market at this time was practically buying the dip.
He frowned and asked, "Oh, by the way—if the company is only worth around 2 billion yen now, how did they manage to get a bank loan of 2 billion in the first place?"
Haruko answered, "Chairman, back in 1974, the company was valued at around 2.5 billion yen. That's why they could borrow 2 billion."
"I see."
Lin finally understood. Banks aren't charities—they don't lend 100% of an asset's value, fearing devaluation and bad debts. An 80% loan-to-value ratio was already quite high.
"Chairman,"
Haruko glanced at him and reminded gently, "Right now, Japan's land prices are still adjusting. No one knows how long it'll last or how much further prices will fall. It's possible that the company's real estate could end up worth only 1.5 billion yen. Since the manga publishing business is in good shape, I think it would be better to invest funds in expanding the core business."
"Don't worry. The reason I acquired this company is because I believe in the manga industry—I'll definitely develop its core business properly."
Lin smiled and nodded. But he had no intention of selling the real estate. No one knew better than him how crazy Japan's property market would get in the 1980s.
"I've allocated 100 million Hong Kong dollars—about 5 billion yen—as development funds for this manga publishing company. I spent 2.1 billion yen to acquire it, so there's still nearly 3 billion yen left. That's more than enough to grow the company."
Hearing this, Haruko said no more. She had done her duty as an assistant by giving her advice—what decisions to make was ultimately up to her boss, Lin Baicheng.