At the beginning of the negotiations, Arthur threw out the bomb, which really surprised the five controlling shareholders of AMC, who originally thought that the British on the other side were already fish on the board and could be slaughtered by them, but now it seems that the other party's determination to acquire AMC is not as big as they imagined.

The representatives of AMC's management, who were marginalized in the negotiations, looked serious and indifferent from beginning to end, as if the negotiations had nothing to do with them.

Although Arthur's attitude did play a role in the negotiations, there was still no way to change the confidence and confidence of the five major controlling shareholders, especially on the issue of debt and IPO.

As soon as he came up, he was stuck, and there was almost no progress in the two-hour negotiation, which made Arthur a little helpless and angry about the five major holding funds, which showed that if you want to buy it at our price, if it is too expensive, you can not buy it.

"These greedy bastards!"

With a gloomy face, Arthur took his men out of the building where the canopy holding company was located, got into the car, and couldn't help cursing angrily, although he was mentally prepared, but he didn't expect that this group of Wall Street vampires would be so arrogant, greedy and crazy.

Not only did they refuse to lower the price of $1 billion in equity, but they also wanted to throw the repayment of short-term debts to Arthur, and even more excessively, they also wanted Arthur to promise that if he succeeded in the acquisition, if AMC was listed in the future, the bond issuance would be underwritten by the five of them.

"I really think I'm a lamb to the slaughter... ”

In the carriage, Arthur squinted his eyes slightly, and sneered with a mocking face, to be honest, this acquisition of AMC Cinemas and this group of old Wall Street foxes will either lose an excellent business opportunity, or become the god of war again.

He wants to keep the interest on new bonds as low as possible, extend the borrowing time as much as possible, and at the same time face the cutting of the five major private equity shareholders to minimize the transaction price of AMC's equity.

He also knew that in the eyes of many, even his men, his goals seemed almost impossible unless a miracle happened.

"Hehe, help me make an appointment with Gary Lopez, CEO of AMC, I invited him to dinner and wanted to talk to him alone!"

Hearing the boss's instructions, the person in charge of the negotiation in the same car couldn't help but light up his eyes, and hurriedly replied: "Understood, I'll call the other party immediately." ”

Arthur looked at his subordinate who took out his mobile phone, the corners of his mouth rose slightly, leaned back on the car seat, his fingers lightly tapped the armrest of the car seat, narrowed his eyes slightly, and sneered.

To be honest, it is extremely difficult and important to know oneself and the other in cross-border acquisitions across the Atlantic. Whether the management is friend or foe is undoubtedly a top priority. What kind of countermeasures the management takes in an M&A case, whether it is confrontation, fire watching or cooperation, depends largely on the attitude and actions of the buyer.

In the history of mergers and acquisitions, for the original management, buyers can be forced to retreat by thunderbolts, or they can be lured back with sugar-coated shells, and the terminology in the merger and acquisition industry is "golden parachute", and they can also be tied together to share interests, the so-called "golden handcuffs" plan.

And Arthur had already thought that he would pull the members of AMC's management into his camp and deeply tie himself to the management to buy AMC

You know, except for management, no one knows the full picture of AMC's operations. Without the protection of management, he would not have tried to acquire AMC.

Why is management so important? For M&A buyers, a thorough and detailed investigation cannot be done without the cooperation of management. Arthur is also a veteran of the acquisition industry, and the sponsor must understand his target company, because the ultimate success of the merger depends on the acquirer identifying exactly how much debt the company can afford, accurately calculating which budgets can be cut, and which businesses should be sold to repay loans.

Any mistaken decision could prompt the bank to demand early repossession of the loan, details of which only the management knows. Otherwise, miscalculations or incorrect projections can leave both parties in huge debt.

When it came time to buy the Shore Power Plant, Angela, his financial advisor, said that in some ways, a merger was like buying a used car. The annual financial statements and some public information of the acquisition target are like classified ads. The material includes as much useful information as advertisements, but sophisticated acquirers know that a savvy accountant can selectively disclose information in the interests of the company.

Anjilai also explained that after the person who bought the used car saw the advertisement, he would also communicate with the owner of the car and do a personal inspection of the car, and then drive the car around a few times. Compared to buying a used car, the buyer also needs to determine exactly how many kilometers the car can run, what parts need to be replaced, and what maintenance and repairs will need to be done in the future. If the car sellers don't let the buyer kick the tires to see if it's sturdy, the buyer can only stay away from the used car.

To take the initiative, you need to convince management. Only in this way can he see all kinds of confidential information about AMC, and only with the help of management can Arthur know where to cut the money, where to cut the budget without affecting the operation of AMC, and what assets can be sold without affecting performance, otherwise, he can only look outside the door or feel the stones to cross the river.

Of course, according to U.S. law, the acquired company must send someone to cooperate with Arthur's investigation, but the law does not stipulate the extent to which AMC will cooperate.

If management doesn't cooperate, the takeover will be a disaster. CEOs of American companies also understand that wealth is not based on wages and bonuses, but on equity, and options can also be used. They don't have to worry about money.

Therefore, the breakthrough point of Arthur's acquisition of AMC is to find the management, show the hole cards, and cooperate frankly with the management, but will never give up control of the company.

However, there are obstacles to cooperation with management. AMC's current private equity fund company once had an equity incentive, which was a stock option plan in 2004, if the control of AMC is transferred, the equity incentive implemented by the previous shareholder will automatically become invalid, how to calculate the loss of management?

Of course, it is to receive it in full and give cash compensation. Arthur will not be stingy in this regard, as long as he can persuade the management to cooperate more effectively, Arthur will be more arrogant!

"Boss, Gary Lopez agreed, and he seemed surprised that we had approached him so quickly... ”

"Accident? Not necessarily... It is important to know that any successful leveraged buyout is inseparable from a series of data forecasts, profits, sales volume, and most importantly, cash flow. This data, which can reveal how much debt a company can at most be able to repay without affecting its operations, is key to negotiations.

For the acquirer, a correct bid price is everything, because the higher the price, the more debt the company will have. Even the best companies can be crushed if they are too heavily indebted.

And the only person who has mastered and is familiar with these data is the management of AMC, and he, as the CEO, Gehry, knows better that anyone who wants to buy AMC cannot bypass them.

The five major funds are going to suffer if they treat the management so slowly!" Arthur said with a sneer, in the previous negotiations, it can be seen that the five major controlling shareholders have been ignoring the management of AMC, and during the entire negotiation, Gary Lopez, as the representative of the management, did not say a word, like an observer who has nothing to do with himself.

"I'm different, my philosophy is that everybody gets rich together! Benefiting management has never been a stopgap measure for the success of an M&A. The acquisition and listing of the Coastal Power Plant is a good example, isn't it? Next, I will throw them a whole set of compensation systems to tie the management firmly to my AMC chariot... ”