Ling Ya
The prince's milk incident has recently become the focus of attention again because Ling Ya, deputy director of the Zhuzhou Public Security Bureau, was arrested.
Almost all voices pointed the finger at the corrupt people represented by Ling Ya, believing that they used their power to bring down and share the prince's milk. Is that the case? Let's review the rise and fall history of the prince's milk wave and find the answer from the historical facts.
Let's start with the conclusion: the so-called five-member team rumored on the Internet may indeed have secretly granted each other and embezzled assets after the fall of the prince's milk. The bloodthirsty foreign capital did stab the prince a few times when she was weak. But the pot that the prince's milk collapsed with a bang really cannot be dumped on the "group of 5" and foreign capital. With Li Tuchun's gambling style, in the magnificent but dangerous development history of Prince Milk, diversification, rapid expansion, gambling, melamine public opinion, financial turmoil, after passing this level, I am afraid that it will be difficult to cross the next level.
Li Tuchun and the prince's milk
The founder of Prince Milk, Li Tuchun, a native of Linxiang, Hunan Province, came from a poor family and worked in a state-owned enterprise for 10 years after graduating from university. In 1990, he began his first gamble: resigned from a state-owned enterprise and went south to Shenzhen with 300 yuan.
In 1993, after several years of entrepreneurship without success, Li Tuchun, who returned to Zhuzhou, made the second gamble in his life: borrowed 100,000 yuan from the bank and printed a batch of commemorative wall calendars, thus digging his first pot of gold.
After that, with the one or two million yuan earned from selling wall calendars, he made one gamble after another: acting as a playboy, bookstore, hotel, video hall. After gambling, Li Tuchun lost a fine loss, owed a debt to the bank, and had to go south to Shenzhen again. In the process of groping, he placed his bet on the live milk drink.
In 1996, Li Tuchun established Prince Milk Factory.
In 1997, Li Tuchun made another big gamble and invested 88.88 million yuan in CCTV prime advertising time to win the championship. At this time, the annual sales of Prince Milk was 30 million, the company's total assets were not yet high at the bidding price, and even more than half a year could not pay salaries, it was said that even the money for the 200,000 admission tickets of the bidding king was borrowed. Li Tuchun gambled the fate of the prince's milk on CCTV advertisements. If the gamble is successful, the prince's milk can survive, otherwise, the company goes bankrupt, and Li Tuchun himself will also face huge debts. Fortunately, this time, he made the right bet again.
CCTV advertising bidding site
After the broadcast of CCTV's prime section advertisement, sales increased explosively that year.
In 2007, in order to go public, Li Tuchun received $73 million from Link, Morgan Stanley, and Goldman Sachs. In the same year, he also borrowed 500 million yuan in low-interest loans from six consortiums in his personal name. This is another big bet by Li Tuchun, the bet is that within three years after the investment, Prince Milk's performance must grow by more than 50%, otherwise he will lose his 61.6% stake.
After receiving the funding, Li Tuchun expanded rapidly in many fields, from real estate and children's clothing to supermarkets and even chili sauce. In the dairy sector, production bases are also expanding rapidly.
But the rapid expansion did not exchange for the prosperity of prince's milk. In 2008, the global financial crisis broke out, and Prince Milk encountered debt collection by Citi, British Link, Morgan Stanley and Goldman Sachs.
Prince milk with foreign intervention
In March of the same year, Prince Milk forcibly launched the listing despite the company's financial situation. Unexpectedly, the melamine crisis caused by Sanlu milk powder caused the national dairy market to enter a cold winter, and the sales of prince milk plummeted, and the listing plan came to an abrupt end.
In order to raise funds, Prince Milk raises funds from distributors and employees in the form of high-interest returns. Relying on the reputation of CCTV's "standard king", Prince Milk introduced the policy of "the more money, the more goods taken, the higher the cash discount" to dealers. Dealers continue to make payments, Prince Milk has established a huge distribution network across the country, and also fictionalized a prosperous market. Behind the surface prosperity, Prince Milk's raw materials and equipment, plant construction, and even the ingredients of the staff canteen are obtained on credit.
On November 21, 2008, after fundraising was fruitless, Li Tuchun had to transfer 61.6% of the shares of Prince Milk Group to the three bloodthirsty investment banks according to the "VAM Agreement". But the hyena-like investment banks stabbed the weak prince milk a few more times - did not fulfill the promised capital injection.
Shareholding structure of Prince Milk under state-owned assets holding in Zhuzhou City
Considering that Prince Milk has only encountered a capital chain crisis, product quality, brand awareness and market network are still there, and it is estimated that there is a 40% gross profit space, if bankruptcy will bring huge social problems, Zhuzhou Municipal Government decided to save Prince Milk.
In this context, Hi-Tech Dairy was established, and the Zhuzhou Municipal Government provided about 100 million yuan to Hi-Tech Dairy to resume production and operation. Li Tuchun lost control of the prince's milk.
On July 27, 2010, Li Tuchun and his son Li Shuai were arrested on suspicion of illegally absorbing deposits from the public.
On September 28, 2011, the reorganization plan was approved, and Prince Milk was taken over by Xinhua United and Sanyuan Consortium.
In January 2012, Li Tuchun was acquitted after 15 months in detention.
The personnel and current situation of the princely milk incident in that year
The five-member task force responsible for handling the prince's milk incident has since fallen: Ling Ya, the detonator of this public opinion, a member of the five-member team of the prince's milk task force, turned himself in on March 3, 2023; Wu Bing, Ling Ya's husband, an executive of Hi-Tech Group, responsible for hosting Prince Milk, was taken away for investigation on January 3, 2023; Wendibo, chairman of Hi-Tech Group, was arrested in July 2011 for corruption and bribery and received nine years in prison; Yang Weiguo, then the propaganda minister of Zhuzhou, according to Li Tuchun's revelation, Yang Weiguo guided public opinion in the princely milk incident, suppressed the princely milk group and Li Tuchun himself, and was arrested in 2022; He Jianbo, then vice mayor of Zhuzhou City and director of the management committee of the high-tech zone, and the direct leader of the prince's milk incident, was arrested in October 2022. At this point, all the 5-member task force of the prince's milk incident that year fell off.
Power is greedy and capital is bloodthirsty
In this incident, the situation of other participants is also very bad: Prince Milk's distributors and suppliers around the country have no money; Bank staff were punished for lending money to princely milk; The heads of several foreign investment banks were implicated in the failure of Prince Milk's investment, Chen Baisong, the managing partner of AB Investment in charge of Prince Milk, resigned in 2007, and the relevant departments of Morgan Stanley's direct investment department in the Asia-Pacific region were also completely eliminated.
And Li Tuchun, who did not have the prince's milk, was acquitted after being detained, and with the identity of a "tragic entrepreneur", he bombarded Citibank for forcing debts to bring down the prince's milk, saying that he "encouraged Li Tuchun's industrial entity to serve the country and beware of the (Xinhua United Fu Jun) empty gloves white wolf money model", and at this time, Fu Jun had been pit into a mess by the prince's milk.
Hyena-like capital
From the above history of the rise and fall of Prince Milk, it can be seen that the so-called five-member team may indeed have secretly granted and embezzled assets after Prince Milk fell. The bloodthirsty foreign capital did stab the prince a few times when she was weak. But the pot that the prince's milk collapsed with a bang really can't be thrown to the "group of 5". With Li Tuchun's gambling style, diversification, rapid expansion, gambling, melamine public opinion, financial turmoil, after passing this level, I am afraid that it will be difficult to cross the next level.
Li Tuchun is a hero and a gambler. In his own "gamble" again and again, he achieved the brilliance of the prince's milk. In the end, he also lost badly.
Li Tuchun