After Xu Jiayin, the former chairman of Evergrande Group, the outside world has been speculating about how many assets he has hollowed out of Evergrande. Xu Jiayin has used various means over the years to secretly transfer tens of billions of funds from Evergrande. Only from the public channels, it can be seen that Xu Jiayin has obtained a huge income from Evergrande.
Recently, Xu Jiayin's ex-wife Ding Yumei sued her son Xu Tenghe to the court, demanding that he repay 1 billion in arrears. This once again attracted the attention of the outside world to the Xu Jiayin family. Some analysts believe that this may be Ding Yumei and Xu Jiayin teaming up to avoid risks through technical transfer of assets. Whatever the truth, the lawsuit raises an important question: How much money did Xu Jiayin transfer from Evergrande before and after?
To solve this problem, we first need to look at a set of data - Evergrande's dividends since its listing. Since Evergrande was listed in Hong Kong in 2009, the annual dividend amount has been very high. Since 2015, Evergrande's dividends have entered an "explosive" period, with dividends exceeding 10 billion yuan for three consecutive years.
Specifically, from 2015 to 2017, Evergrande's annual dividends were 116 billion, 133 billion and 103 billion yuan respectively. Joining Evergrande's dividend data in the first few years of listing, the total amount of dividends publicly disclosed by the management is about 500 billion yuan.
The ultimate beneficiary of these dividends is Xu Jiayin, the actual controller of Evergrande. Because Evergrande's Hong Kong-listed company, Xu Jiayin controls about 30% of its equity through a multi-layer holding structure. This means that the Xu Jiayin family has made a profit of more than 150 billion yuan from the public dividend data alone.
In addition to shareholder dividends, Xu Jiayin also reimbursed personal consumption to Evergrande's accounts through various other means. For example, for his personal use of private jets and yachts, the purchase and daily maintenance costs are borne by Evergrande. This includes a yacht worth more than 500 million yuan "Xianglong".
In addition, Xu Jiayin returns to his hometown of Deng County, Henan Province every year to worship his ancestors and give red envelopes, and the relevant expenses are also borne by Evergrande. Even the family cemetery built by Xu Jiayin in Henan was funded by Evergrande Henan Project Company.
It can be seen that Xu Jiayin's personal consumption, from clothing, food, housing and transportation to the sacrificial cemetery, is directly reimbursed to the accounts of Evergrande Company. Taken together, these expenditures are a significant number every year.
In addition to shareholder dividends and personal consumption, Xu Jiayin also made a profit by subscribing to a large number of US dollar bonds issued by Evergrande. Mr. Xu and the offshore companies he controls have subscribed to tens of billions of dollars in Evergrande bonds over the past decade. This also brought him a huge amount of bond interest.
For example, the US$4 billion high-interest bond issued in 2015 alone has an interest rate of up to 2$500 million. Similar high-interest dollar bonds, Xu Jiayin's huge profits after subscribing can be imagined.
It should be noted that Xu Jiayin's direct or indirect holdings of Evergrande's equity, as well as the bonds subscribed, are all operated through offshore companies. This means that tens of billions of dollars of income end up in overseas accounts set up in tax havens.
It is with these hidden financial concealment networks that Xu Jiayin has been able to exchange his personal income with the company's assets for a long time. This long-term extraction has also led to a serious shortage of funds and a crisis of confidence in Evergrande.
Xu Jiayin's means of transferring assets and the huge amount of money shocked the outside world. Judging from the public data alone, he has made hundreds of billions of yuan through various channels, and the actual number is probably even higher. However, the good times did not last long, the long-term plunder finally pushed Evergrande to the brink of bankruptcy, Xu Jiayin himself has been controlled, and what awaits him will be a long judicial trial.
The collapse of Xu Jiayin reflects a truth: a company's sense of social responsibility and moral bottom line are the most important cornerstones of business success.