Money Machine

Chapter 12Untying the Knot

As of 2004, it had been nearly two years since the whole process had begun, and we were still far from breaking the deadlock. Nevertheless, soon after the new year I met with a regulator who told me there was still a strong desire at the top levels of the central government for our deal to proceed. He suggested that one of our co‐chairmen write a letter to China's leaders to express our commitment to the Chinese market and our intention to bring international best practices to SDB. The letter, the official said, should include our credentials and a description of our first‐rate team, its experience in banking and so forth. He also suggested we mention Shenzhen's wish for us to withdraw the arbitration request, our understanding of the same, and our own desire to work out a deal in an amicable manner.

I took the message to indicate that the Shenzhen side was ready to resume talks but didn't want to appear to have capitulated to Newbridge. They wanted a face‐saving way to get the deal back on track. I understood this, particularly given that our quarrel had been so public. We were willing to oblige. After all, we just wanted to do a deal, not to win a fight, and we were eager to get back into the good graces of the Shenzhen government.

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Few deals proceed without detours, and ours certainly had its share. Just as we were preparing to return to the negotiating table, a Hong Kong company contacted us, presumably also at Shenzhen's request. We knew the ...