America: Starting with the acquisition of MGM

Chapter 17 The role of 17ak film and television

Chapter 17 The role of film and television

In the United States, acquiring a listed company is very troublesome, with complicated procedures and lengthy processes that often take more than half a year or even longer.

But MGM has its own special characteristics. It is a listed company, but 92% of its shares are concentrated in the hands of Kerkorian, and only 8% of the shares are actually circulating in the market.

Of this 8% of shares, MGM's middle-level executives account for another 5%. For example, Charlie Cooper holds 1% of the shares. In fact, only 3% is actually in the hands of retail investors.

And just after the fiasco of "Windtalker", 3% of the retail investors in the market have been sold off, all of which were silently eaten by dad at the first time. So in theory, Charlie Cooper can now be regarded as MGM the second largest shareholder.

As for the stocks in the hands of the rest of MGM's middle and senior management, Charlie Cooper definitely couldn't buy them. He had conflicts with that group of people, but if he couldn't do it, Kerkorian could.

So within a short period of time, Kerkorian increased his stake to 96%, and the two actually held 100% of the shares.

Then there is delisting. This is the real purpose of gathering equity, so that MGM can be delisted and privatized.

In the end, it was sold directly to the Coopers and Sons, which saved a lot of acquisition time and could resolve the battle within a month at the earliest.

Although listed companies can raise funds for development, this is compared to ordinary companies. Eric, who has the advantage of foresight, does not need it at all. Going public will only drag him down.

Moreover, MGM is in such a bad situation now that it is already very unfavorable by the market. Even if it goes public, it will only raise less than a few dollars and it will cause trouble. It is really unnecessary.

As for the government departments, it is no longer a problem. Money can lead to gods, and the process is unexpectedly smooth!

As US$2 billion gradually arrived, news that MGM was to be acquired also spread in the market.

At this time, the company was still depressed because of the box office failure of "Wind Talker". Suddenly hearing the news, some middle and high-level executives began to investigate the acquirer's information, but there was no reaction from the grassroots.

Whoever you love has little to do with them anyway. No matter who takes over, they will still have to use them. If they dare to fire them, they will cause trouble. The union is not a living wage.

The ones paying more attention than a few senior executives are actually Sony and Warner.

The two families had long wanted to take over MGM, and they had had many private conversations with Kerkorian, but the results were not satisfactory.

The reason is also very simple, not enough money!

Sony and Warner are only willing to pay US$400-500 million in exchange for part of MGM's shares, thereby obtaining the operating rights of MGM.

These two major companies believe that with their own strength, they can bring MGM back to life, and then slowly dilute Kerkorian's equity, thus eating up MGM at a relatively small price, but it will take a long time. That’s all.

But Kerkorian doesn't accept this at all. He only wants cash, enough cash, and anything else is nonsense.

Kerkorian is not interested at all in the IP, studio, director, special effects and other plans that Sony and Warner talked about.

In the eyes of this casino tycoon, acquisitions that do not involve giving cash are just hooliganism and free prostitution.

So when Sony and Warner found out that the acquisition amount was as high as 2.8 billion US dollars, which was still in cash, they stopped thinking about getting involved midway.

US$2.8 billion, even if the two companies split it equally, each would have to pay US$1.4 billion, not to mention that it is impossible for them to split it equally.

The most important thing is cash. No matter how many fixed assets you have or how big your IP is, it doesn't matter. It's not cash.

No one made any trouble, and the delisting was completed in just one month. The subsequent acquisition process also went smoothly, and major Hollywood companies and even some forces on Wall Street set their sights on the Cooper family.

No one thought they could suddenly obtain US$2.8 billion. In the eyes of the market, the two fathers and sons should be acting as the white gloves of a certain funder father.

But no matter what, Eric suddenly became a hot favorite in Hollywood, and Charlie Cooper's status rose to a higher level.

In the past, he was just the CEO of MGM, an insignificant wage earner under Kerkorian.

Now he is still the CEO of MGM, but his identity has changed into a movie giant boss with billions of wealth.

Time came to mid-August. After a busy month and a half, and after sending out more than 8 million US dollars to establish relationships, the acquisition was finally settled, and the speed was miraculous.

In Charlie Cooper's opinion, there was really no need to be in such a hurry. That was eight million dollars, enough to make a B-level movie.

But Eric insisted on hurrying, because the post-production of "Red Dragon" and "Barbershop" has been completed and will be released soon.

These are two big-money movies, and the lack of guarantees will give Kerkorian some ideas, such as a temporary price increase. Similar things happen all the time.

Moreover, Eric is not at ease with the other major film companies. In short, things will change later, so it is better to be safe.

At night, a party was being held at Cooper's house. Not many people were invited, only Eric's four best friends and a few of his father's friends.

The reason for inviting these people is naturally to make a major change in the top management of MGM.

The structure of a film and television company is very complex, including multiple departments such as marketing, production, creativity, administration, finance, and scripts. Each department has multiple branches.

For example, the publicity department is responsible for art, poster production, advertising, etc., and has more than 2,000 employees.

Including the number of people in other departments, MGM employs more than 3,000 employees, with monthly salary expenses reaching millions of dollars.

But don’t think that 3,000 people is a lot. Compared to Warner Disney, MGM is just a dwarf, because Warner has more than 80,000 employees around the world, which is very scary.

Among the seven major Hollywood film and television companies, MGM has the smallest number of employees, reflecting the most depressed situation.

However, even with more than 3,000 people, there are many obstacles inside. Although Charlie Cooper is the CEO, he cannot control the overall situation. There are many people in the company who oppose him.

So at the beginning of this acquisition, my father contacted several executives of small companies and invited them to join MGM to replace the disobedient guys.

As for Judy, Warren, Bordeaux and Billy, it is too early for them to take charge now. They should learn from them first and wait until they are capable of taking charge on their own.

Gathering around the barbecue grill, Eric took a sip of beer: "I've been very busy recently. Now things have finally come to an end. Are you ready to enter the industry?"

Hearing this, the four of them immediately started talking.

"We have come this far, is there any better choice? Hahaha"

"That's right, I paid 3 million US dollars anyway. Although it's just a fly's leg, I can still be regarded as a shareholder."

"In the film and television industry, I seem to have seen the call of countless beauties."

"Seriously Eric, what position are you going to put us in?"

Eric turned over the grill: "Let's go to each department to study first. It will take two months. I want you to be familiar with the various tasks of this department within two months. I need to know what you are best at. Of course. , and also do other tasks assigned by me."

"What job?"

"Many, such as discovering and purchasing copyrights, including potential comics, novels, games, etc."

"For example, "Spider-Man"? So far, it is the box office champion in North America!" Warren said.

"Also "Resident Evil" is also good. Although I haven't played the game, the movie is very good. Milla Jovovich after the infection is so hot! And the box office is also very high."

Eric nodded: "That's right. Zombies are a very marketable subject. I also plan to shoot a TV series. I need you to do a market survey to ensure that there will be no copyright problems. After joining the job, work with the marketing department. Good thing."

"In addition, Transformers also has great potential for adaptation, but the copyright is in the hands of Hasbro. This is a piece of fat, and we need to win it."

"There is a writer named George Martin. He has a very good work called "A Song of Ice and Fire". He has worked in Hollywood. No matter what method I use, I want to get his copyright."

"There's another very important thing. Which of you likes to watch bad movies?"

The four of them looked at each other, not understanding what it meant.

"It's the kind of movie that has simple special effects, low cost, a lousy plot, and low ratings, which will not be shown in movie theaters."

Warren swallowed a piece of barbecue and said vaguely: "Discs? As long as there is an exciting cover, there are many such movies in the disc market. My dad likes them very much. He bought a lot of them. , I’ve seen a lot of them too.”

Eric's eyes lit up: "Yes, the TV and disc markets are indeed the main areas for bad movies. Warren, are you interested in helping me manage a bad movie company?"

"What?"

Warren choked and looked out of breath.

Judy slapped his back with five thunderous moves, and then spit out the roasted meat.

"I understand the company, but what does a bad movie company do?"

"It is a film and television company that specializes in making bad movies. Of course, bad movies are not a derogatory term. What I want is a small investment and a big return. I am playing with small gains and big gains, just like many B-level movies. Do you understand?"

Warren frowned: "You mean the Blair Witch type?"

"It's almost the same, but the release of Blair Witch is too expensive. We don't want to play that kind of model. I want the kind of pure bloody, copycat, and vulgar movies. Do you understand?"

Warren hesitated: "I have indeed seen a lot of movies like this, but can it really make money? And is it really good to do this?"

The other three were also speechless: "Eric, making a bad movie is equivalent to destroying your own brand."

"Yes, of course a big company wouldn't do such a thing, so didn't I ask you to register a company some time ago?"

"You mean AK Film and Television?"

"Yes, after I take over MGM, I will select a group of professionals to join AK Film and Television. They will be my white gloves, specially used to make bad movies."

The four of them suddenly realized that nothing happened after Eric asked them to register the company. It turned out that he had already made up his mind.

Of course, Eric's doing this was not a whim, because there is indeed a company in Hollywood that specializes in producing bad copycat movies, called Madhouse Pictures.

The movies it has produced include but are not limited to "Atlantic Rim", "Warships", "The Age of the Hobbit", "Avatar vs. Aliens", etc. Just looking at the names, they highlight the authenticity of copycats.

Moreover, the cost of a Bedlam movie is generally controlled within 1 million US dollars. You read that right, not even 5 million, only 1 million.

Whether it's the special effects or the way of service, it gives people the feeling of a street stall.

But the strange thing is that every movie in Asylum makes money, and it also launched a well-known bad movie series "Sharknado", which has gained a great reputation in the global bad movie industry.

Even later, more bad movies were made, and a fixed fan base has been formed.

We know you suck, but we just want to see how bad you reach new heights this time, and we will also buy a set of genuine discs for your collection.

This phenomenon of criticizing ugliness is somewhat similar to when China's "Dwelling in the Fuchun Mountains" was released. A large number of viewers walked into the cinema with the mentality of criticizing ugliness, which contributed to a wave of box office.

As for whether such a rampant copycat operation will lead to lawsuits, the answer is no.

Madhouse Film and Television has embarked on the road of copycats since 2005. By 2023, it has copied more than 300 Hollywood blockbusters. All major Hollywood companies have not escaped the clutches of Madhouse, but they have only been sued twice.

The original company is too lazy to go through the legal process because it takes a long time and basically cannot win the lawsuit. Have you ever seen Nanshan Pizza Hut lose?

Asylum was once sued by Warner Bros. for "The Age of the Hobbit", but Asylum Film and Television stated that my Hobbit is a primitive race in Indonesia, and also produced various scientific reports, which are completely different from your fictional Hobbit. Not the same thing.

Because of this, and in addition, the bad movies of Madhouse are basically not released in theaters. They are almost all TV stations and DVDs. They are targeting different audiences and there is no point of competition.

And not only is there no point of competition, after Madhouse Pictures has made a name for itself, copycat blockbusters can actually help promote the original version. With a win-win outcome, why not do it?

In Eric's vision, AK Films and Madhouse are both similar and different. The similarities are of course all kinds of bad movies. The difference is that AK will also shoot some low-cost B-level movies, which may not be bad enough, but the cost will definitely be low. high.

Another very important point is that Eric really needs money. He still owes the bank US$2 billion. The annual interest is an astronomical figure for ordinary people.

So he needs to make money, and makes money at all costs, but the film and television industry is an industry with slow repayments. After delisting, it will not work to cut leeks from investors. The only person he can rely on is himself.

So money! money! money!

Say important things three times, Eric must make money like crazy!

He has even turned his attention to the stock market. Although he doesn't know much about this industry, he will definitely not lose money if he buys several companies.

Besides, AK Film and Television is its own white glove, so it can start by copying MGM movies.

And it’s only 2002, and Madhouse Pictures has not yet embarked on this path, so I’m sorry, I want to occupy the track in advance.

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