Chapter 317 Fixed Income
Under the bright light, Ronan sat in the reception room of the Long-Term Credit Bank, his gaze inadvertently sweeping over the short island native.
This is Takuya Matsubara, vice president in charge of investment business at Long-Term Credit Bank.
After the two sides had a basic understanding and temptation, they quickly turned to the topic, and Takuya Matsubara asked directly: "Mr. Anderson, the Pacific Film Foundation has signed five film investment agreements with Shahai Entertainment, and with Shahai Entertainment's film production experience in the past few years, I have no doubt that these films have a high chance of success, but according to my understanding, everyone in Shahai Entertainment and the Pacific Film Foundation is you, right?"
This Takuya Matsubara speaks English fluently and doesn't have a particularly strong island accent, so communicating directly with guests from the United States is not a problem.
"Yes, I founded the Pacific Film Foundation in the first place. Ronan couldn't make a mistake with such a simple question, saying: "I set up this foundation to raise funds for Shahai Entertainment's film projects, and since the huge success of "Spy Shadow", my production company has made more shooting plans, including many first-line A-class productions. ”
He smiled and added, "Of course, it can also provide a win-win investment opportunity for money outside of Hollywood." ”
Takuya Matsubara was unmoved, and said, "Mr. Anderson, you are both Party A and Party B." ”
Ronan said calmly: "You have invested in the Silver Screen Special Film Fund, you should know that Hollywood is full of traps, and the foundation invests in my own film projects, which is more controllable and less risky, which is also responsible for the investor." ”
Takuya Matsubara once again questioned: "But this is not good for investors! In fact, there is no shortage of investment opportunities in long-term credit banks." In the film industry, for example, it is more secure for us to invest in local companies. ”
This kind of remark is obviously paving the way for the conditions to be fought for later, Ronan naturally understood, and said with a faint smile: "With your scale, the return on investment and guarantee for the United States is the best." ”
Taku Matsubara didn't speak either, and seemed to disagree with Ronan's words.
Ronan further said: "Since the late 80s and early 90s, the economic environment of the island countries has deteriorated rapidly, and today it has not yet recovered, and almost all of your country's large investment institutions are mainly overseas investment. The economic growth of island countries is slow, resources are relatively scarce, and labor costs are becoming increasingly heavy, and your investment in domestic risk is higher. ”
He spoke at an unhurried pace, but his voice was unusually clear: "For you, the huge American market is full of investment opportunities, and all walks of life are profitable, and Hollywood is one of them. ”
"The film industry is extremely risky. Takuya Matsubara said slowly.
Ronan is well aware that the two sides can sit here and talk, and the long-term credit bank already has a certain investment interest.
"Yes, the film industry is extremely risky. Ronan never denied this: "Film investment is a high-risk property, and it is difficult to control the probability of success, so we can only hope for as few mistakes as possible." Even so, the return on investment of film projects is limited, and behind every dark horse-level movie, there are a bunch of skinny white horses and princes. ”
Takuya Matsubara looked serious: "In this case, once the long-term credit bank cooperates with you, how can the investment income be guaranteed?" he said in a reminder words: "We have invested in the Silver Screen Special Film Fund, and we have enough lessons in this regard. ”
Hearing this, Ronan was not surprised, after all, the island country is also a country with an extremely developed film and television entertainment industry.
Moreover, before coming to the island country, he was prepared, and he would never treat the island people in the same way as he did with Arabs and Indians.
If you want to achieve rapid development of the company, the power of foreign funds is indispensable, but investors in different countries and regions should use different strategies to meet the actual situation of investors.
Ronan had already made a plan and conducted an investigation and demonstration, and then said: "The Pacific Film Foundation will raise funds in installments from the long-term credit bank in the form of high-yield bonds, which is a business cooperation between the foundation and the long-term credit bank. ”
Takuya Matsubara touched his chin: "Financing that exists independently of the film project. ”
Ronan further explains: "This is one of the ways to invest in Hollywood films. Regardless of the success or failure of the Pacific Foundation's investment in Shahai Entertainment's films, the long-term credit bank will receive stable income. ”
Takuya Matsubara immediately realized that if such a partnership could be reached, the investment risk of a long-term credit bank would be minimized.
"What about the yield?" Takuya Matsubara asked directly.
Without any hesitation, Ronan replied, "Ten percent." Many movie foundations in the United States invest in Hollywood films, and a yield of 10 percent is already considered a high level of profitability. At that time, the long-term credit bank cooperated with the silver screen special film and television funds, a total of four phases of raised funds, invested in dozens of films, and the most profitable film was only 11 percent"
Takuya Matsubara participated in the cooperation with the Silver Screen Fund back then, and knew that Ronan was telling the truth.
Long-term credit banks invested in two consecutive tranches at the beginning, and the overall return rate was not even 5%.
Takuya Matsubara thought so in his head, but what he said was completely different: "The return on investment is too low." ”
Seeing him say this, Ronan's heart moved, which also means that Takuya Matsubara's attitude is rapidly tilting towards cooperation with the foundation.
Bargaining is actually not a bad thing for business cooperation.
If you want to cooperate, you will bargain.
If you don't even have the intention of cooperating, do you need to bargain?
10 percent is indeed not high, but the island countries practice low interest rates, and the normal annual interest rate of commercial loans is generally between 0.9 percent and 3.5 percent according to their own different circumstances, and most of them are around 2 percent.
The interest rate on this loan is low compared to other countries.
Ronan made sufficient preparations and said, "Mr. Matsubara, this yield is very high compared to the loan interest rate in your country. ”
Takuya Matsubara was easily moved, saying: "A Hollywood movie, from the investment to the recovery of funds, it takes up to several years, take the first phase of the Silver Screen Foundation fundraising that year, in 1983, the funds were paid, and the last film covered was not released until the spring of 1986, and it was necessary to recover all the proceeds in 1991, a total of eight years, which made the cost of using the funds far exceed the return." ”
Ronan knows very well that Takuya Matsubara is talking about a very realistic point, a film investment, it takes seven or eight years to recover the income, which seems to produce profits, but what about the time cost? There are also currency depreciation and interest losses that accompany time.
"Three years!" Ronan said very confidently: "Our cooperation can be carried out in installments, for example, in the first phase, you will invest 100 million or 200 million US dollars first, and the return and income of this fund will be paid off for three years, and in the third year of signing the contract, the Pacific Fund will pay off all your investments at one time with interest, which can reduce the time cost to a minimum." ”
After several years of operation, Ronan is confident that he can do this.
He can more or less avoid some detours in the film, appropriately shorten the operation process, so that a film can be completed within two years from preparation to release, and the remaining one year is used to recover funds, as long as the film market response is okay, even if it is not a box office hit, it is enough to return the funds of the investor.
And such a film can make long-term profits.
There are certain risks associated with this, but any business operation is full of opportunities and risks.
And with the current situation of Relativity Entertainment, if you want to develop further, you must introduce capital to support, Ronan needs to unify the company's voice at this stage, avoid some risks brought by the six major companies in the next few years, it is impossible to rashly raise funds to expand shares or absorb the capital of Wall Street, so you have to find a way to attract overseas funds that have little interference with Relativity Entertainment.
Hollywood is everywhere imprinted with traces of capital operation, if Hollywood's continuous creative ability is compared to its blood, then capital is the skeleton that supports Hollywood's products to be marketed around the world.
In the past life, well-known companies such as Legendary Pictures, Relativity Media, and Dune Entertainment actually have financial industry genes, and Hollywood's film and television industry has also formed a diversified investment and financing model with multiple investment and financing channels and multiple investment and financing models coexisting.
This also ensures that Hollywood films have ample sources of funding.
For example, in the famous "Avatar", Twentieth Century Fox itself invested limited funds, and the two film and television investment companies of Dune Entertainment in the United States and Jingqiao Media in the United Kingdom jointly contributed 60% of the production cost and publicity expenses to the film.
Takushi Matsubara also seriously considered that such a yield was more cost-effective than a commercial loan.
Ronan added: "If you invest in other industries, there are not many industries that can achieve such a high rate of return, and you also face the risk of investment failure." In the past two years, the economic situation in the United States has not been stable, the social situation is not very good, and there have been frequent accidents in the social and economic fields......"
Takuya Matsubara immediately thought of the NASDAQ crash and the 911 incident, and his brow couldn't help but frown slightly.
Investing in traditional industries has relatively minimal risk, but the return on investment in traditional industries is ...... Don't mention it.
Taku Matsubara will not let go easily, and once again said: "The return on investment of 10% is too low. ”
"We can go on talking. Ronan said calmly: "I believe that we will be able to reach a consensus on this cooperation." ”
Takuya Matsubara said seriously, "I also hope to reach a consensus on this cooperation. ”
This meeting is only to lay the foundation for future negotiations, Ronan and Matsubara Takushi also have a preliminary intention of cooperation, and the specific negotiations can be handed over to the following people to negotiate.
Involving hundreds of millions of dollars in investment cooperation, the two sides cannot be too cautious.