news

한어Русский языкEnglishFrançaisIndonesianSanskrit日本語DeutschPortuguêsΕλληνικάespañolItalianoSuomalainenLatina

Zebra Consumption Yangzhe

If you have the chance to ask Che Jianxing why he has been so anxious recently, you might get a standard answer: start over again.

During the adjustment cycle of the real estate industry, Che Jianxing's Red Star Holdings also came to the crossroads of fate.

Over the past few years, in order to eliminate risks as soon as possible, Che Jianxing successively sold Red Star Real Estate and Macalline Properties, and even gave up the controlling stake of Red Star Macalline. However, Red Star Holdings has not yet turned the corner and has recently entered the reorganization process.

Che Jianxing has been in business for 38 years, and time seems to have passed in a flash. He started with 600 yuan and reached the peak with a net worth of over 40 billion yuan. Red Star Macalline became the largest home furnishing mall in China and was once extremely prosperous. He would not have expected that the cold wave would sweep across and his winter would come so quickly.

Urgent

On July 13, IKEA (601828.SH) announced that the operating conditions of its own shopping malls will be disclosed in regular reports instead of monthly summaries, in order to avoid the market's unfavorable judgment on the company's commercial competitiveness and affect the interests of the majority of small and medium-sized investors.

Since Xiamen State-owned Assets took actual control last year, the company's internal governance has become increasingly perfect, and it has remained low-key and restrained during the market downturn.

The reason for having to do so, in addition to the influence of the external market environment, is that the company's second largest shareholder, Red Star Holdings, and its actual controller Che Jianxing have long been in a liquidity crisis. Any slight disturbance will inevitably affect the secondary market.

In recent years, in order to get rid of the crisis, Che Jianxing successively transferred the relevant equity of Hongxing Real Estate and IKEA Properties, and also gave up the control of IKEA, but the funds obtained still could not fill the hole.

It is difficult for the outside world to know the exact size of the pit of the Red Star Group. As of the end of 2023, Red Star Holdings had a net loss of 27.185 billion yuan and a total debt of 32.525 billion yuan. During the same period, the unrestricted monetary funds on the books were only 110 million yuan.

This instantly overturned the image that Che Jianxing had worked hard to build for many years: he drove a Rolls Royce when traveling, and he ordered 100 sets of the same clothes at a time. When he was in high spirits, this boss did a live broadcast with Gao Yuanyuan, and also invited Zhou Huajian, Yang Zongwei and others to sing at the Red Star Macalline National Tour Concert.

Che Jianxing painstakingly built up the huge Red Star business empire, but it went back to the past overnight. In early July this year, Red Star Holdings applied for bankruptcy reorganization to the Shanghai Pudong Court and was accepted. The 58-year-old Che Jianxing entered another time.

Before the reorganization was accepted by the court, he had been executed for a total amount of 1.341 billion yuan and was also restricted from moving; the total amount of execution against Hongxing Holdings was 2.011 billion yuan.

Red Star Falls

Che Jianxing and Wang Zhenhua started their businesses in Changzhou, their hometown, at almost the same time. Wang focused on residential real estate, while Che saw the charm of home furnishing commercial real estate.

Wang Zhenhua was imprisoned for his abnormal desires, but he indirectly saved Sunac China Holdings (601155.SH). In comparison, the business story of Macalline is even more tortuous.

In 2012, Red Star Macalline had 100 home furnishing malls across the country, leading the industry. In 2015, the company was listed on the Hong Kong Stock Exchange, and in 2018 it was listed on the A-share market, becoming the first A+H-share company in the domestic home furnishing retail industry. That was Che Jianxing's highlight moment. In 2018, he became the richest man in China's furniture industry with a fortune of 38.5 billion yuan.

At its peak, Red Star Macalline had nearly 400 home furnishing malls, including self-operated, entrusted management, and strategic cooperation. Boss Che's ambitions expanded and he stepped into the real estate industry ambitiously.

In 2020, the wind direction of the real estate industry changed suddenly. He also took out 4.7 billion yuan to help Huang Hongyun of Jinke Holdings to deal with Sun Hongbin. That year, the sales scale of Hongxing Real Estate reached 65.4 billion yuan, ranking 59th in the industry.

But not long after, Che Jianxing stepped into the same river as Huang Hongyun.

Since 2021, he has successively sold 70% of the equity of Hongxing Real Estate and its seven logistics companies to Sino-Ocean Capital, and also transferred the control of IKEA to Jianfa Holdings.

According to Red Star Holdings' 2022 interim report, short-term loans and non-current liabilities due within one year totaled more than 25 billion yuan, while during the same period, the company had only 8.756 billion yuan in cash on hand. The liquidity crisis continued to brew, and the risk series rose sharply.

In November of that year, Red Star Holdings' 20 Red Star 05 bonds were extended, revealing the liquidity crisis. Che Jianxing's Red Star business empire showed signs of collapse.

The Carpenter Strikes Back

Many of the business owners born in the 1960s started from scratch and emerged from industries such as tailoring, bricklaying, breeding, trade and small handicrafts.

Che Jianxing, who was born into a poor peasant family in Changzhou, dropped out of school at the age of 16 to learn carpentry, and then worked as a carpenter on construction sites across the country.

In 1986, he was asked to make a set of modular furniture, which touched his restless heart. Che Jianxing, who was in his 20s, borrowed 600 yuan from people and opened the Qinglong Wood Furniture Factory.

At that time, the furniture industry generally relied on carpenters working alone. Che Jianxin's factory-based production changed the inefficient manual production model. The processes and links were scientifically controlled, which improved manufacturing efficiency and product standardization. He successfully made his first pot of gold.

Being a furniture manufacturer alone was very hard, so Che Jianxing turned his business model to furniture malls. In 1990, he opened the first Red Star Furniture Mall in Changzhou, with an exhibition area of ​​more than 1,000 square meters, setting a precedent in the industry.

Che Jianxing was not satisfied. Years later, Red Star Macalline Home Furnishing Malls blossomed across the country, and the business model evolved and upgraded to operations and rental collection, achieving unprecedented success.

In addition to the IKEA home furnishing mall, Che Jianxing has also invested in dozens of companies, covering many industries such as entertainment, real estate, finance, and the Internet.

In 38 years, Che Jianxing has made a comeback from a small carpenter to a tycoon in the home furnishing and capital markets.

With the storm coming, the end of the king of China's home furnishing mall is just a few years away.