Du Wenqiang came to Li Xuan not only to report on the sales of these three newly listed computer game floppy disks, but he also had other things.

"Xiao Li Sheng, we have already talked about it with the three companies, this is a specific merger plan, we account for 30% of the shares!" Du Wenqiang put away the smile on his face and said to Li Xuan seriously.

Oriental Games is responsible for the production of more than 5 arcade machines per month, mainly by the three foundries, as well as Oriental Company's own arcade factory in Shatin. After Dongfang Game Company was spun off from Dongfang Electronics, Li Xuan hoped that it would become a company focusing on game research and development. The game publishing business will be entrusted to the newly established Oriental Commercial Co., Ltd. to take full responsibility.

The outsourcing of the end of the production and manufacturing process has always been the firm implementation of the idea of Oriental Company, and Oriental Game Company is no exception. However, due to the actual needs of the initial production of the Oriental Company, it established a large arcade factory by itself.

Under the idea of Oriental Game Company's focus on R&D and outsourcing of all production, this arcade factory has now become a big burden. So Du Wenqiang had the intention to further separate him from the game company.

But how it should be managed after the split, and the establishment of a new independent subsidiary is certainly not anachronistic. It just so happened that Li Xuan had the intention to integrate the peripheral enterprises around Dongfang Electronics. So he put forward a plan, hoping to merge the three electronics factories that used to produce arcade machines for the Oriental Game Company into a large-scale OEM enterprise.

If the three companies merge into a large electronics company, they can not only unify and integrate logistics procurement and production management, but also effectively reduce production costs. Moreover, it also placed production orders for Oriental Games. What's more, the Oriental Company could integrate its own arcade factory into the new company.

But all three companies have different bosses and their respective management. Who will be in charge of the operation of the new company after the merger, and how will the shares of the various bosses be distributed? These are very difficult questions.

So Du Wenqiang, under the instruction of Li Xuanyang, began to communicate with the bosses of the three factories. The current orders of the three factories are all from Oriental Games. Therefore, several bosses really dare not have too many objections.

So the merger negotiations began, and the initial interest of the bosses was not high, more like they could not directly refuse Du Wenqiang's merger proposal, and they were not interested in the merger, and they were a little perfunctory. However, it soon became apparent that Oriental Games did not seem to have a great interest in taking control of the new company, and was not trying to figure out how to merge to annex their three factories.

At the same time, Dongfang Company also gave a specific research report, if the three factories can be combined. After consolidation, the number of non-labor jobs can be cut in half. In addition, after unified management, the reduction of logistics, procurement and other costs can reduce the production and operating costs of the entire company by about 10%.

Faced with this number, the attitude of the three bosses suddenly changed, and they began to actively discuss a series of key issues such as the distribution of equity and management arrangements of the new company after the merger. After more than a month of verbal warfare, Oriental Games and the three arcade foundries finally reached a merger agreement.

According to the asset appraisal report made by Hong Kong Pricewater, the three electric subsidiaries and the arcade factory spun off from Oriental Games. Oriental Games Company has a 30% stake in the newly established Xintongda Electronics Company. The name of Xintongda Electronics Company is composed of the names of the original three electronics factories, Xinguang, Li Tong and Qida, each with one word.

After the establishment of Xintongda Electronics Company, its net assets will reach 20 million Hong Kong dollars. With a monthly OEM production of 50,000 arcade machines and an annual output value of HK$120 million, it will suddenly become one of the largest electronics companies in Hong Kong.

"In the first few of their factories, we sent technicians to help with production management training. It can be said that everyone is from the same source, and the management system is the same. It's a lot less troublesome to integrate!" Li Xuan quickly scanned the integration plan and said with a smile.

"yes. There is no need to make adjustments in production and management, and we use the system we originally formulated! The only thing to do is to lay off employees, and at least seventy or eighty people can be demolished in the first batch!" Du Wenqiang nodded and said.

Most of the new companies were made administrative staff redundant, four factories were merged into one, and many duplicate administrative departments needed to be integrated, and some departments would be redundant if they were bloated. This is also an important aspect of reducing costs, and these eliminated jobs can save a lot of salary and welfare expenses.

"In the next step, Jiekang Electronics and Dongsheng Electronics will also merge, and we will also inject some funds to hold part of the equity of the new company!" Du Wenqiang continued.

Jiekang Electronics and Dongsheng Electronics are the OEMs of Gameboy handheld machines and game cards for Oriental Game Company. The two companies have also recently been engaged in merger communication under the mediation of Du Wenqiang. Both companies have reached the limit of their production capacity and are raising funds to build new factories, and Dongfang Electronics will inject a sum of money in exchange for a part of the new company's shares.

These actions are a series of means for Dongfang Electronics Company to strengthen its influence on Dongfang peripheral companies. Through a series of methods such as orders, shareholdings, unified procurement, bank loans, etc., these companies will be firmly tied to the chariot of Dongfang Electronics.

"How did the previous negotiations with X-Trail Game Office go?" Li Xuan suddenly asked.

X-Trail Games is a small game production company based in Kyoto, Japan. In the past, Taidong Company used hundreds of thousands of yen in research and development costs to win a commercial miracle in sales of tens of billions of yen on the arcade of "Space Invaders", which completely detonated the Japanese game industry.

Countless Japanese companies are starting to enter the industry, hoping to be the next lucky ones to get rich overnight. X-Trail Games is one such company, but unfortunately it has not made any achievements in the arcade field.

After its launch in Japan last year, Oriental's Gameboy portable handheld console quickly became popular throughout Japan, selling millions of units in a year. After failing to succeed in the arcade field, X-Trail turned its attention to the newly popular handheld.

However, X-Trail itself has limited strength, and has previously spent a lot of investment in arcade projects. Unable to develop its own handheld consoles like Casio, Seiko Epson, and other powerful companies, it set its sights on Gameboy, which was dominant in handhelds.

Li Xuan's original idea for Gameboy was to separate the machine and card. Although due to the technical reasons of the printed display, the game screen of different games must also be integrated with the game card and replaced at the same time. This makes the price of Gameboy's game card with a display not low, reaching 60% of the price of the whole machine.

However, this strategy of separating the machine and card can still allow players to save a lot of money without having to buy the fuselage repeatedly, thus greatly increasing the user's consumption stickiness. X-Trail Games took a fancy to this and sent a letter to Oriental Games, hoping to obtain authorization to produce compatible game cards

This is the first gaming company to make such an application to Dongfang Electronics. When Li Xuan decided to separate the machine and card, he had already considered that he would develop Gameboy into a game platform in the future, and would authorize third-party manufacturers to launch games.

The most famous of such similar practices in later generations is undoubtedly Nintendo's FC red and white machine and the famous "royalty" system. Nintendo has changed the rules of the game for the entire industry, creating a new profit model.

When the FC Red and White Machine was first launched, it quickly opened up sales thanks to its extremely low sales price and sophisticated self-made games such as "Super Mario". After the FC Red and White Console established a monopoly in the U.S. and Japanese markets, Nintendo began to license to third-party game software vendors.

Nintendo's royalty system simply means that hardware manufacturers are responsible for promoting hardware, software manufacturers have to pay a part of the money to hardware vendors, and software has to be reviewed by hardware vendors. But in fact, Nintendo relied on the monopoly position of FC red and white machines in the market, so that he was extremely strict with the licensing conditions issued by third-party software vendors, and almost all the risks were transferred to the other party, and he did not lose money.

After receiving the application letter from X-Trail, Oriental Game Company directly rejected the plan to authorize the other party to produce compatible game cards. But Oriental Games has also proposed another way to cooperate. X-Trail is responsible for creating games, and after the game score reaches the publishing standards of Oriental Games, Dongfang will organize the production and distribution on behalf of Dongfang, and X-Trail will only participate in the final profit sharing.

Such conditions are very unfavorable for X-Trail, which has almost no autonomy, and the entire game publishing process is firmly controlled by Oriental Games. As a result, negotiations between the two sides reached an impasse from the outset.

But Li Xuan is not in a hurry at all, Gameboy is sweeping the entire handheld game console market, Nintendo's GameWatch, as well as the handheld products of Casio, Seiko Epson and several other companies, are completely unable to pose any threat to Gameboy. With such a huge circulation game platform in hand, Li Xuan is not worried at all that no company will give in.

"The Japanese side has softened its stance, and X-Trail has tentatively agreed to hand over the production and distribution of game cards to us. But they still haven't let up on paying the deposit and sharing the game copyright!" Du explained, adding that negotiations between the two sides have dragged on for more than two months.

"Paying a deposit is a must, once the game quality is unsalable, we can't bear these losses, and we must deduct it from the deposit paid by the other party!" Li Xuan said with a smile, "As for sharing game copyrights, it may indeed be difficult for some strong people, and this article can be waived!"

Oriental Games Company was in a strong position in the negotiations, and the conditions given were naturally harsh. Although the company requires third-party software vendors to entrust the production and distribution of the developed games to itself, it is unwilling to bear any sales risks. (To be continued......)

ps: After writing three chapters, I finally have the face to shout a few times for a monthly pass! Where is the monthly pass! I'm waiting for you!