Conquer America, Start with a Boxing Champion

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 break up Lionsgate's Netflix, lest it affect the company's layout.

This is different from Spotify.

Spotify's market value has grown relatively quickly 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%. .

SB Project 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 movies 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 they chose Lionsgate, Relativity, or even Weinstein Co. instead of joining the Big Six.

The main reason is the company's "independence".

In the 1980s and 1990s, New Line Cinema, Castle Rock Entertainment, Sony Classics, Miramax, Focus Features, Screen Treasures, Hollywood Pictures, and Roeg Films were all independent film companies.

After being acquired by the Big Six, these companies were gradually controlled by the Big Six and lost their independence as independent film companies.

Among them, the representative is New Line Cinema, which was founded in 1967 and initially started by distributing low-cost horror movies. In 1990, it successfully released "Teenage Mutant Ninja Turtles" and became a first-line independent film company in Hollywood.

As a result, it was favored by Time Warner and acquired by Warner in 1993. Later, it became a leader in the field of independent production by distributing and producing the "Lord of the Rings" series.

But in 2007, it failed to distribute "His Dark Materials: The Golden Compass", which caused dissatisfaction from Time Warner.

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 the requirements of Warner Pictures, and the movie titles no longer appeared.

Miramax also had a conflict with its parent company Walt Disney and was later sold, as well as DreamWorks and Focus.

If Bradman sold Summit Entertainment to the Big Six, Summit Entertainment would disappear in a few years.

In addition, at this stage, the Big Six studios all control three or four independent production companies, and are not very interested in acquiring new small production companies, and the offer will not be too high.

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

"Hey, Link, congratulations, Lionsgate is now the seventh largest studio in the film industry, which is amazing."

At the signing reception, David Ellison and his sister 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 and cooperate with me."

"No problem, Lionsgate is now the leader of independent production companies. If there are projects that need cooperation, they will naturally find you."

Megan Ellison smiled.

"Welcome!"

Link smiled lightly and talked to Megan about the upcoming "Zero Dark Thirty", which is jointly produced by Lionsgate and Annapurna Pictures and distributed by Lionsgate. It is also the focus of the Oscars next year.

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

Leon Cavanaugh of Relativity Pictures also came over to congratulate, and changed a female companion beside him.

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

Link responded.

Lionsgate originally planned to discuss the acquisition of Summit Entertainment or other companies in two or three years, but Lionsgate Films developed rapidly last year and this year, from 800 million US dollars in July and August last year to nearly 2 billion. There was not much pressure to acquire Summit Entertainment, so the acquisition was made in advance.

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

Leon Kavanaugh asked with a smile.

"Yes, sometimes."

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

Leon Kavanaugh smiled.

Link understood Kavanaugh's idea.

Now Lionsgate Films has done well in low-cost film investment, and Kavanaugh came to learn from it.

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

Kavanaugh did not hear the "secret" and could not help but feel a little disappointed.

In fact, after the movies released by Palm Beach Studios and Lionsgate became big hits, he and his analysts analyzed in detail the hit movies such as "Bridesmaids", "The Gossip Project", "The Help", "Silver Linings Playbook" and "Buried".

Unfortunately, no pattern was found in them.

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

What is the method of Link or Palm Beach Studios to invest in movies?

If he could learn the core technology and produce several dark horse movies in succession, coupled with his ability to brag and hype, he would definitely be able to make the market value of Relativity Pictures more than 1 billion, or even surpass Lionsgate.

What a pity.

Kavanaugh looked at the Link couple surrounded by the crowd and gritted his teeth in envy.

——

Originally, Lionsgate belonged to the seventh largest film company in Hollywood. In recent years, Summit Entertainment has surpassed Lionsgate in annual box office with the "Twilight" series of movies, and is considered the eighth largest in Hollywood.

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

After this news was reported by the Los Angeles Times, it attracted a lot of attention in the film industry, and also attracted many media reports and comments, and discussions.

First, discuss the impact of the merger of the two companies.

After Lionsgate acquired Summit Entertainment, its production and distribution capabilities have been greatly improved. The original annual output was about 20, and now it can produce four or five more movies each year, comparable to the six major film studios, becoming the real seventh largest in Hollywood.

The negative impact is that the leading bird will be shot. After Lionsgate became the seventh largest, it is also the leader of the independent film industry, and faces greater competition from the six major film studios.

If Lionsgate fails to operate well and suffers losses on a major project, it is very likely that it will be involved in a debt crisis like MGM and then be divided up by the Big Six.

But if Lionsgate can really withstand the siege of the Big Six and continue to develop, it may not be impossible 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 it was Lionsgate Pictures that successfully won it.

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

Some media estimated that the relationship between Harvey and Link would become worse because of this incident, and the competition between the two sides would become more intense.

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

Link did not make any explanation for these disputes.

When asked about this on a CBS interview program, he publicly stated that the reason for entering the film industry was his love for movies, and the purpose of acquiring Lionsgate and Summit Entertainment was to make more beautiful and distinctive independent films, not to praise someone or to have conflicts with someone, which was too naive.

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

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

Harvey stared at Link on TV and said angrily.

Bob shook his head and breathed a sigh of relief.

——

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

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