Across America, Starting with the Boxing Champion

 Chapter 511 Hollywood’s Seventh Biggest

When discussing the acquisition of Summit Entertainment, Link originally wanted to split the 11.37% Netflix.

Netflix’s current market value is 3.8 billion US dollars. Yes, when he acquired Netflix last year, Netflix’s market value dropped from more than 12 billion to 3.2 billion.

At the beginning of the year, Netflix's share price once recovered to 4.5 billion US dollars. However, due to the impact of the stock market and competition from other video websites, Netflix's share price fell back to below 4 billion US dollars in August and September.

Considering that the market value of Netflix is ​​not high for the time being, and I still have a large amount of funds on hand, if I want to invest in Netflix, I can buy another part of the shares and increase the original 5.3% of Netflix shares controlled by Capital Baker Investment to 10%.

There is no need to dismantle Netflix, which is owned by Lionsgate Pictures, so as not to affect the company's layout.

This is different from Spotify.

Spotify's market value has grown rapidly and has now surpassed Pandora Media, reaching US$5 billion.

The price of the 16.8% shares controlled by Link Music has reached 840 million. The future value will be higher, and it will be more cost-effective to separate and manage it.

After several rounds of negotiations with Universal Music Group, Link Music agreed to invest US$500 million to acquire 33.5% of Link Music's shares based on a market value of US$1.5 billion.

After Universal Music became a shareholder, there were major changes in the board of directors of Link Music. Link is still the largest shareholder of Link Music with 45.8% of the shares, Universal Music is the second largest shareholder with 33.5%, and Evaka is the third largest shareholder with 13.7%. .

SBproject Entertainment holds 3.2%, and the remaining 3.8% is held by several executives of Link Music, as well as singers such as Lana Del Rey and Mars.

Due to the addition of Universal Music, the market value of Link Music increased slightly and was overvalued to US$1.8 billion.

Link and Iwaka have also become shareholders of Universal Music Group, holding a total of 2.2% of Universal Music shares.

—

After finalizing the price to acquire Summit, after several rounds of negotiations, Summit Entertainment finally agreed to merge with Lionsgate Pictures at a price of 10% of Lionsgate shares + 270 million in cash.

Although Harvey intervened in the negotiations many times and expressed his willingness to increase the acquisition price. The initial offer was 430 million, which eventually increased to 500 million. He hoped that Summit Entertainment would change his mind and cooperate with them.

But after seeing the olive branch offered by Lionsgate, Summit Entertainment never talked to anyone from Weinstein Films again.

This also led to the smooth progress of negotiations between Lionsgate and Summit Entertainment.

According to regulations, after the merger, the two companies will still distribute and produce movies under the two labels, maintaining the independence of Summit Entertainment.

Lionsgate Pictures is still managed by Lionsgate senior management. Summit Entertainment’s production and distribution department will remain unchanged for the time being. Lionsgate can take over Summit Entertainment’s finance, publicity, legal and other departments.

In addition, there have been changes to Lionsgate’s board of directors.

Summit Entertainment chairman Robert Bradman joins the board of directors as deputy director of the company.

Eva Ka is still the chairman of Lions Gate Pictures and owns 5% of Lions Gate shares.

Seeing that Lionsgate would not go bankrupt for the time being, Jon Felleme, the former chairman of Lionsgate Pictures, invested US$75 million to recycle 5% of Lionsgate's shares and also joined the board of directors.

There are also executives such as Steven Bewkes, Michael Burns, and Brian Goldsmith who initially did not sell their shares when Lions Gate was delisted and held approximately 4.7% of Lions Gate shares.

The remaining 75.3% is held by Link, who is also the chairman of Lionsgate's board of directors.

"Haha, Robert, welcome to Lionsgate."

After signing the contract, Link shook hands with Robert Bradman, chairman of Summit Entertainment.

"Thank you! Mr. Baker, it is a pleasure to work under your leadership."

Bradman shook his hand and smiled.

"Robert, you are so polite. You are the senior in the film industry. Please give me more advice in the future."

Link laughed.

Bradman is in his sixties. He founded Summit Entertainment in 1997 and has produced and distributed films such as The Twilight Saga, So You Think You Can Dance, Operation Smith, Vanilla Sky, Two Smoking Barrels, and The Hurt Locker. , and he is also a relatively capable person in the film industry.

The reason why he chose to sell Summit Entertainment is that competition in the film industry has become more intense in recent years.

Before the 1990s, the eight major film studios co-existed with many independent production companies. Independent production companies could even compete with the eight major film studios when they joined forces. The film industry had a letting-a-hundred-flowers-blooming attitude.

By 2000, as MGM went bankrupt and was divided up, Columbia Pictures was acquired by Sony Pictures, New Line Cinema was absorbed by Warner Bros., Miramax was acquired by Disney, Focus Pictures was acquired by Universal, and DreamWorks Pictures The industry was acquired by Paramount, and so on.

There are only six major film companies left in the film industry, as well as independent production companies controlled by the six major film companies. Independent production companies with independent autonomy include Lionsgate Pictures, Relativity Pictures, Summit Entertainment, Weinstein Pictures, etc. The total annual box office is often less than the annual box office of one of the top six.

As competitiveness intensifies, it is difficult for independent production companies to survive and their profits have greatly reduced. This is also the main reason why Summit Entertainment is willing to cooperate with Lionsgate Pictures.

The second reason is that Robert Bradman is getting older and hopes to find a good home for Summit Entertainment before retiring.

As for why he chose Lionsgate, Relativity, and even Weinstein Pictures instead of joining the six major film studios.

The main reason is also the company’s ‘independence’.

In the 1980s and 1990s, New Line Cinema, Castle Rock Entertainment, Sony Pictures Classics, Miramax Pictures, Focus Features, Screen Treasures, Hollywood Pictures, Rogue Pictures, etc. were all independent producers. company.

Later, after being acquired by the six major film companies, these companies were gradually controlled by the six major film companies and lost their independence as independent film companies.

Representative among them is New Line Cinema, which was founded in 1967. It initially started by releasing low-cost horror movies. In 1990, it successfully released "Teenage Mutant Ninja Turtles" and became a first-tier independent production company in Hollywood.

Because of this, it was spotted by Time Warner and was acquired by Warner in 1993. Later, it relied on the distribution and production of the "Lord of the Rings" series to become a leader in the field of independent production.

But in 2007, it was dissatisfied by Time Warner due to the failure to release "His Dark Materials: The Golden Compass".

New Line Cinema was merged into Warner Bros., ending the 40-year history of New Line Cinema. From then on, New Line did not release movies, but only produced movies according to Warner Bros.'s requirements, and movie titles no longer appeared.

Miramax was also sold due to conflicts with its parent company, Walt Disney, as were DreamWorks, Focus, etc.

If Bradman sells Summit Entertainment to the Big Six, Summit Entertainment will disappear in a few years.

In addition, at this stage, the six major film studios all control three or four independent production companies. They are not very interested in acquiring new small production companies, and the price quotes will not be too high.

This is one of the reasons why Summit Entertainment prefers to merge with Lionsgate, the seventh largest company in Hollywood.

"Hey, Link, congratulations. Now Lionsgate has become the seventh largest company in the film industry. This is amazing." At the signing reception, brother and sister David Ellison came over with champagne glasses and smiled.

"It sounds good, but the bigger the company, the greater the pressure. If you have any good film projects in the future, remember to come to me for cooperation."

"No problem. Lionsgate is now the leading independent production company. If there are projects that require cooperation, they will naturally come to you."

Megan Ellison laughed.

"welcome!"

Link smiled softly and chatted with Megan about the upcoming "The Hunt for Bin Laden". This movie is jointly produced by Lionsgate Pictures and Annapurna Pictures, and will be distributed by Lionsgate Pictures. It will also hit theaters next year. Highlights from the Academy Awards.

"Hey, Link, congratulations, you made a good deal with Summit Entertainment."

Leon Cavanaugh from Relativity Pictures also came over to congratulate him, and there was another female companion beside him.

"Haha, Leon, I hope you are right."

Link responded.

Originally, Lionsgate planned to talk about acquiring Summit Entertainment or other companies in two or three years. However, Lionsgate Films developed rapidly last year and this year, from US$800 million in July and August last year to nearly US$2 billion. There is little pressure to acquire Summit Entertainment, so we acquired it in advance.

"Link, are you still using big data models to estimate the value of investing in movies?"

Leon Cavanaugh asked with a smile.

"Yes, sometimes."

"Can you talk about your specific method of evaluating movies? I want to communicate with you and make progress together."

Leon Cavanaugh laughed.

Link understood what Kavanaugh was thinking.

Now that Lionsgate Pictures is doing well in low-cost film investment, Kavanaugh has learned from the opposite.

He did not hide it. He talked about his understanding and practice of big data film investment, but he also told the other party clearly that he had too many things to do and rarely got involved in these specific film investment tasks. Most film projects were decided by the production department. .

Kavanaugh couldn't help but be a little disappointed that he didn't hear the 'secret'.

In fact, after the movies released by Palm Beach Pictures and Lionsgate became successful, he and his analysts analyzed in detail such popular movies as "Bridesmaids", "Scandal Project", "The Help", "Silver Linings Playbook" and "Buried Alive" .

Unfortunately, no pattern was found among them.

This also made him more curious about Link's investment methods.

What is Link's or Palm Beach Pictures' approach to investing in movies?

If he can learn the core technology and produce several dark horse movies in a row, coupled with his ability to boast and hype, he will definitely be able to increase the market value of Relativity Pictures to more than 1 billion, even surpassing Lions Gate.

such a pity.

Kavanaugh looked at the Links and his wife who were surrounded by the crowd, and gritted his teeth in envy.

—

Lionsgate was originally the seventh largest film company in Hollywood. In recent years, Summit Entertainment has been considered the eighth largest studio in Hollywood with its "Twilight" series of movies, and its annual box office has sometimes exceeded Lionsgate.

Now the seventh and eighth largest have merged to become one company.

After this news was reported by the Los Angeles Times, it aroused great attention in the film industry, and also attracted numerous media reports and comments, and there was a lot of discussion.

The first is to discuss the impact of the merger of the two companies.

After Lionsgate merged with Summit Entertainment, its production and distribution capabilities have been greatly improved. The original annual output was about 20 movies, but now it can produce four or five more movies every year, which is comparable to the six major film studios. Become the real seventh in Hollywood.

The negative impact is that it missed the mark. After becoming the seventh largest film company, Lionsgate Pictures is also the leader of the independent film industry. It faces greater competition pressure from the six major film companies.

Once management fails and suffers losses on a major project, Lionsgate is likely to be involved in a debt crisis like MGM and subsequently be divided by the Big Six.

But if Lionsgate can really withstand the siege of the Big Six and continue to develop, it may not be able to become a large film company comparable to the 'Big Six' in the future.

The second point of discussion is that Relativity Pictures and Weinstein Pictures successively proposed to buy Summit Entertainment, but in the end, Lionsgate Pictures successfully won.

It is said that because of this incident, Harvey Weinstein became furious and shouted in public that he wanted to kill Link. You can imagine how angry Harvey was at that time.

Some media estimate that the relationship between Harvey and Link will become worse because of this incident, and the competition between the two parties will become more intense.

However, some people do not agree with this and insist that Link and Harvey are in conflict on the surface, but secretly they are in a cooperative relationship. The conflict between the two is also a means of publicity and hype.

Link did not provide any explanation for these arguments.

When he was asked about this on a CBS interview show, he publicly stated that he entered the film industry because of his love for movies. The purpose of acquiring Lionsgate and Summit Entertainment was to make more good-looking and unique independent films, not to It's too childish to flatter someone and have conflicts with someone.

He showed some appreciation for Harvey, thinking that he might not be a good collaborator, but he was a capable filmmaker.

"Hmph, do I need your praise? Link Baker, don't be proud, this matter is not over yet."

Harvey said angrily, glaring at Link on the TV.

Bob shook his head and breathed a sigh of relief.

—

When Lionsgate Pictures successfully acquired Summit Entertainment, there was also big news in the sports industry.

Dynasty Sports raised 540 million and received 58.8% from Clippers owner Sterling, becoming the new owner of the Los Angeles Clippers. Link also became one of the owners of the Clippers.

(End of chapter)