on november 10th 2007, new york was the last stop of dongyue’s road shows for going public. citibank and underwriters were going to decide the strike price finally, and the next day, dongyue would go public in hong kong stock exchange.
before then, dongyue had prepared ten months for it, and had experienced a very long and tough journey of going public. a team represented by president zhang and general manager cui endlessly negotiated with securities trades, investors and intermediary organization through endless teleconferences. the business pattern and management concept that our company made great efforts to build and proved to be effective were vetoed and rebuilt again and again, along with endless reform. while they removed all the obstacles in the way of going public, there came the investors’ indifference since investors had little knowledge of the fluoro-silicon industry and the stock market was gloomy then.
on november 10th, zhang jianhong, cui tongzheng, zhang jian, he xin, yu xiuyuan and others finished their roadshows respectively in hong kong, singapore, london, boston, washington and other places, and got together in new york. at that time, mental stress, nonstop working plus jet lag wore them out.
more cruelly, the underwriter gave a price that was much lower than their bottom line at a negotiation room of citibank. the price was originally estimated to be between 2.6 to 2.8 yuan, and 2.6 was a very tragic price. however, the price that the underwriter gave was only 2.16 yuan, which was non-negotiable.
if it went public at this price rather than our estimated price, our company would lose several hundred millions’ capital. if we did not accept the price, we would waste all our previous efforts--10 months’ hard working and over one hundred millions’ commission charge, and we also might be attacked by the economic depression. in addition, there were only a few hours left before its legal time for going public in hong kong. therefore, there was no time for any hesitation.
they were at a stalemate from the 3pm to the midnight, and they stated their own views and reasons respectively again and again. however, they both refused to give in. the underwriter stuck to their price and there was no room to negotiate.
time passed by, and there was one hour left before the final time. every member of the dongyue team felt so disappointed. but zhang jianhong knew that the price related to the profit rate, while going public decided the existence of the company. after a final discussion with members of the team and getting approval from all the members, zhang jianhong finally had to sign the dongyue stock purchase agreement. at that moment, it was almost 3 am (new york time), and only half an hour before the official time for going public. meanwhile, the fatigue and great pressure on him was suddenly released, and he almost fainted when signing the paper. he xin, former director of bone department of microlink, went forward and held him stand up.
however, the final decision that president zhang made let the company have two billion reserve capital before the financial crisis. not only did we avoid one disaster, but also we took a great opportunity in the crisis. more importantly, dongyue has entered into the international capital market from that day on, and has got its new beginning and a new platform.