Clairland listened carefully and took notes, and it was clear to him that today's senior management meeting was a little different from the past. Everyone spoke freely, spoke very enthusiastically, and various points of view kept colliding to produce countless sparks.

It's not that everyone was silent before, after all, everyone present was an elite with extraordinary wisdom. It's just that no matter how everyone discussed it before, in the end, Li Xuan's final decision can always lead the company to victory after victory.

But today, that god-like decision-maker is vacationing thousands of miles away in Europe. Everyone who was accustomed to accepting Li Xuan's leadership suddenly needed to make real independent decisions, which made everyone feel the pressure. Everyone in the room is undoubtedly the best talent. Previously, under Li Xuan's anti-heaven appearance, everyone suppressed their ability to think, and gradually began to rely on Li Xuan's judgment.

When this repression disappeared, the elites of the Eastern Bloc present finally burst out with a strong light. Since the morning, the management has been discussing the first few topics, and even the lunch is solved in the conference room.

The last and most important issue of the day is about IBM's acquisition of the shareholder software company, the two companies have been negotiating for half a year, but they have not been able to reach an agreement, and IBM has recently begun to become tough.

"Our group's development idea is to build a complete upstream and downstream ecological chain in the entire IT industry. The front end is the Oriental Research Institute and the Oriental Semiconductor Company, which are responsible for the R&D and manufacturing of integrated circuits, the middle section is the Aikang Computer Company, the Oriental Game Company, and the Oriental Software Company, which are responsible for the product application development, and the tail end is the Oriental Commercial Company and the Computer Park Company, which are responsible for the later sales.

Relying on the integration and optimization of the entire industrial chain, we can reduce costs and improve comprehensive competitiveness. Maximize profits. And around this core industrial chain, we are building a huge industrial cluster in Hong Kong. Several important nodes in this industrial cluster are chips, games, computers, and software.

Previously, Dongfang Software Company had been dependent on Aikang Company, but now this dependence is rapidly declining! According to Dongfang Software Company's sales figures for the first half of this year, sales outside the ABC series of computer platforms. It has grown from 5% to 17% before, and this share will further soar with the launch of new models using the East-DOS operating system such as IBM and Deyi in the second half of the year.

Due to the strong position of the ABC series of computers, the technical standards of ABC-3 computers previously disclosed by Aikang have actually become the industry standard of the personal computer industry. So far, more than 500 manufacturers of various accessories have announced their support for the ABC-3 computer technical standard. The ERM-1 processor and East-DOS operating system are included in this standard. It is gradually establishing an unshakable dominant position in the industry.

In contrast, the East-DOS system may be in a more secure position. Intel Corporation and IBM are investing a lot of resources in developing their own RISC (Reduced Instruction Set) architecture processors. Once processors with new architectures hit the market, the ERM-1 will usher in stiff competition.

And the only possible threat to East-DOS is the CP/M system of the American company DRI (Digital Research Corporation). But it is clear that Mr. Kildare, the owner of DRI, would prefer to choose to enjoy life rather than continue to participate in the fierce market competition!" Han Peng carefully analyzed.

He can be said to be the second person in Dongfang Electronics Company after Li Xuan. After many adjustments to the company's structure, he still serves as the president of Dongfang Technology Holdings, the president of Dongfang Commercial, and the chairman of the board of directors of Aikang Computer Co., Ltd.

Among them, Dongfang Technology Holding Co., Ltd. holds the equity of most of the subsidiaries of Dongfang, which can be said to be the core link between various companies. Oriental Commercial is the company responsible for information collection, procurement, sales and other key businesses in the system, while Aikang Computer is the only listed company in the Oriental Group. So Han Peng's status is undoubted, Li Xuan is not there, he is the undisputed host of this meeting.

With the continuous growth of the sales of ABC series computers. The share of the East-Dos operating system continues to climb. In particular, after Aikang disclosed the technical standards of ABC-3 computers, the attention of the entire microcomputer industry suddenly jumped from 8-bit and 16-bit to 32-bit computer era.

The personal computer industry is changing rapidly. And DRI clearly can't keep up with this change. And DRI, which used to have a monopoly in the field of operating systems, is still indulging in its glory in the 8-bit era. As early as July last year, when the ABC-3 computer was launched, Dongfang Software randomly released a new version of the East-DOS system that supports the 16/32 processor ERM-1, while DRI's 16/32-bit CP/M operating system was not on the market until not long ago.

Oriental Software previously acquired the computer park company through guò. By the way, it has obtained a deep license for the CP/M system, and can develop a CP/M compatible operating system. The new version of East-DOS is CP/M compatible. However, on the other hand, CP/M is not compatible with the East-DOS system.

Many of the high-performance software previously developed for the ABC-3 computer simply did not run on the new CP/M system. Oriental Software, on the other hand, took the initiative. Constantly liaise with other third-party software companies and computer vendors to support their own East-Dos system. This further leads to the fact that the CP/M system is not competitive at all in the 16/32-bit era.

"Although we have made some concessions, there is still a certain gap with IBM's offer!" said He Guoyuan, president of Dongfang Software, "according to IBM's latest offer, they are willing to pay $500 million to buy 25% of our shares." Of these, $300 million was paid in cash, and the other $200 million was replaced with IBM stock!"

He Guoyuan frowned and said, "DRI's CP/M system has absolute dominance in the eight-bit era, but everyone knows that the eight-bit is a thing of the past. Our East-DOS system has established an absolute advantage in the 16/32-bit market with the first-mover advantage of the ABC-3 computer.

But this advantage is not yet solid, if IBM switches to support the 16/32-bit CP/M operating system on the new PC. It's going to cause a lot of trouble for our East-DOS! And IBM sees this very well, and I think their threat may not come true, but it must be guarded against!"

IBM has recently become increasingly assertive in negotiations, and there is news from the US side that IBM has reached an agreement with the DRI. CP/M systems will be supported on PCs.

It was precisely because of the arrogance of DRI that IBM chose Bill Gates' Microsoft as the developer of the operating system for PCs. In another time and space, Microsoft relied on embracing IBM's thighs, starting from the DOS system, and eventually growing into a super demon in the computer industry.

But the PC trend in this world has not yet risen. It was blocked in the bud by Aikang's ABC series computers. Microsoft's DOS system naturally failed to catch fire, and PCs had already begun to support the East-DOS system of Dongfang Software Company. Now the PC supports the CP/M system, which is a computer with a very average sales volume, and there are three operating systems for users to choose from.

Dongfang Software is not afraid of the CP/M system at all, and will rely on the PC that has been classified by IBM itself as a failed product to make waves. But if IBM always switches to CP/M support in the next new computers. Under the vigorous promotion of IBM, there may really be a lot of trouble. After all, the foundation of the CP/M system in the 8-bit era is too strong, and many applications may be able to be applied to the new 16/32-bit system with a little modification.

"Have you considered the possibility of further splitting up Dongfang Software Company?" Huo Qiuxing, who had not spoken much before, suddenly said loudly, he was the president of the Oriental Economic Research Institute, and it could be said that he was Li Xuan's chief think tank.

With the support of Li Xuan, the Institute of Oriental Economics has grown into a research institute with nearly 100 researchers. In addition to providing strategic advice to Dongfang Electronics, it has recently started to publish a series of research reports on Hong Kong's industrial economy, which has attracted a lot of attention.

"Dongfang Software's business is divided into two main parts. One is operating system software, and the other is application software! According to Dongfang Software's sales figures, the sales revenue of operating systems accounts for only 35 percent of the company's total sales revenue. The remaining 65% of the revenue comes from applications such as East-Word, East-Table, East-dbase, etc.!

But it's clear that both IBM and ourselves are more interested in the future of East-DOS, which is likely to dominate the operating system market in the next 16/32-bit era and beyond!

After we made concessions to IBM, the asking price for a 25% stake in Oriental Software was reduced to $600 million from the initial $650 million. Based on this calculation, the total valuation of the entire company is $2.4 billion. The operating system, which accounts for only 35% of sales, is valued at $1.2 billion alone. It accounts for half of the value of the entire Oriental Software Company.

Since we are not willing to lower the offer, we are even more reluctant to accept IBM's equity exchange plan. Then it is better to simply split up Dongfang Software Company. Take out the operating system company separately to accept IBM's shares. 25 per cent of $1.2 billion is exactly $300 million. That's exactly the maximum amount of cash IBM is willing to give!"

Don't look at the market value of large companies, which can easily be billions or even tens of billions of dollars, but that is only the market value, and the company does not have a lot of cash in its hands. Therefore, most of the large-scale mergers and acquisitions in history were completed by equity replacement, and very few of them actually used cash.

Five or six billion dollars in cash is not impossible for IBM to come up with, but such a huge expenditure will definitely affect the cash flow of the entire IBM company in the short term. If some of them can be converted into private placement shares, the impact on IBM will be much less.

For Dongfang Electronics Company, if the equity replacement is accepted, there will definitely be a short lock-up period for the shares in hand. This not only prolongs the time to recover the funds, but also adds additional risk due to fluctuations in IBM's stock price, which is naturally not as pleasant as paying in cash all at once.

"If Dongfang Software Company splits up, will the competitiveness of the newly independent application software part be affected?" Han Peng asked with some doubts.

Although Dongfang Software Company strongly supports other third-party software companies, it develops various application software based on the East-DOS system. However, this does not include text software, form software, and data library software, which are the products that Dongfang Software has own. So software such as east-word, east-table, east-dbase and so on do not compete at all on the east-dos platform.

Once Dongfang Software completes the split, IBM and other external companies begin to enter the board of directors of the new company, they will definitely demand open competition, so that other application software will have to start to face fierce market competition!

"The value of operating system software lies in the fact that it is indispensable for every computer, and it is also the platform for other software to run! East-DOS system has won the support of the vast majority of third-party software vendors and computer companies, and our own performance of this software is excellent enough, under the superposition of these factors, it has a good chance to form a market monopoly and completely dominate the personal computer operating system market in the near future!

But in my opinion, if the East-DOS system really rules the market, we will definitely face a lot of trouble, such as the antitrust investigation of the US Department of Justice.

IBM was able to entangle with the U.S. Department of Justice for a decade and finally settle because it is an American company. As a foreign company, Dongfang Electronics is naturally hostile and suspicious! The reason why we were willing to accept IBM's shares was also to find allies and share the pressure we might suffer in the future.

Rather than trying to find a way to get into trouble in the future, it is better to take the initiative to split it up now! In this way, even if it is attacked in the future, the more influential system company can attract firepower, and the application software company can hide in the corner and make a fortune!"