Chapter 214: The Pit
Eric gently put down the coffee cup in his hand, looked up and said: "Mr. Murdoch, you must know something about me, I am a very stubborn person, if you let me speak, then there will be no more concessions in the conditions I say, and if Fox can't accept it, then the two sides will definitely have a very unpleasant quarrel." So, let's start with it, if Fawkes's conditions satisfy me, I'm not an insatiable person. β
Murdoch secretly cursed a little slippery head in his heart, this is not insatiable, but Murdoch only thought for a moment before speaking: "Eric, Fox and Firefly have always been very happy cooperation, so it is better to use 5% of Fox Film Company to replace Firefly's shares in the same proportion, I think you also know the market value of Fox, Firefly has taken a big advantage, which can also make the cooperation between the two film companies closer." I used this price in exchange for the premiere rights of the following four seasons, and the 70% advertising share ratio just proposed remains unchanged, what do you think of this time?"
When Eric heard Murdoch's offer, he was slightly moved for a few seconds, and then he didn't feel like he was taking advantage of it at all.
He heard clearly that what Murdoch was talking about was trading Fox Films for a stake in Firefly in equal proportions, not a stake in Fox Network.
The public may think that the two companies are one, but Eric is clear about the differences, and although they are currently under the control of Barry Diller, Fox Film Company and Fox Television Network are completely unrelated companies. Fox Films now has a market capitalization of around $2 billion, and a 5% stake is worth $100 million, while a 5% stake in Firefly is really not worth that much right now. Based on the price at the time of the merger with the new line, the market capitalization of the Firefly is only about $600 million. In this way, as long as Firefly agrees to an equity exchange with Fox, it is equivalent to making $70 million.
But things are far from that simple.
After the merger of the Firefly and the new line. No matter which Hollywood movie giant is in Hollywood, they know the potential of Firefly, if the momentum of Eric's film box office harvest is maintained. Maybe in a few years, Firefly's status will be on a par with the seven major film companies. Correspondingly, the market value of Fireflies will also skyrocket, and maybe it will surpass Fox.
Eric is so confident that if it goes his way, the process won't even take five years. Some time ago, he paid 15% of the shares and a large sum of money to acquire the new line, and Eric was willing, because it would make up for the shortcomings in the distribution ability of Fireflies and greatly shorten the pace of the rise of Fireflies.
A 5% stake can already have a say in the board of directors. After exchanging shares with Fox, Eric not only did not see much benefit, but was constrained by it.
And......
Eric tugged at the corners of his mouth slightly, leaned forward slightly, and asked Murdoch on the other side, "Mr. Murdoch, how much do you think Fox Film will make this year?"
Murdoch's heart skipped a beat, and his heart said Could it be that this little guy saw through it?
However, Murdoch still held on to a hint of luck, shook his head and said: "I don't know too much about this matter, and I won't know until the financial report is released at the end of the year." β
Eric almost sneered, "Mr. Murdoch." I can do the math for Fox a little bit, because Mr. Barry Diller focused on the Fox network, and Fox itself didn't have a lot of movies. There is not a single large-scale zuΓ² movie with high box office potential. This year's Fox is focusing on my three films, and the dust has settled, 210 million in North America and 530 million worldwide, and Fox can get at least $70 million in profits excluding distribution costs. Moreover, I personally think that the next two movies Fox will get at least $100 million in profits, plus other films distributed by Fox and peripheral income such as videotapes. Hah, what a good year. Maybe this year's annual profit of $300 million will be almost double that of a normal year. β
Murdoch heard Eric's summary. It is inevitable that I will be happy, if this is the case, this result will definitely rank first among the seven major film companies, even Warner, which has made a lot of money this year, may not be able to create such a high annual profit. After the year-end earnings report comes out, Fox's market value will definitely usher in a * rise.
However, after the surprise, some of Murdoch's luck in his heart was completely shattered, and he just asked dryly: "Eric, isn't this good?"
"Of course it's good," Eric said, "So, let's calculate the Firefly's profit this year." β
Eric said, holding up a few fingers and counting them one by one: "According to the current box office trend, the global box office can still reach about 500 million US dollars, and the Firefly can get about 100 million US dollars again, and at the end of the year, excluding the cost, the Firefly can at least get 100 million US dollars like Fox." Don't forget, I have three other films that will be released at the end of the year, and I am very optimistic about all three films, but even if the three films are combined, they will only get $100 million. At the end of the year, with the same 5% of the shares, Fox can get 20 million dividends, but Firefly can only get 15 million. β
Speaking of this, Eric took back the arm that was erected in front of him, but he was extremely angry in his heart, originally after Murdoch put forward the conditions, Eric was still tempted for a moment because of the difference in the value of the 70 million US dollars, but after such a combing, he found that this was a big hole dug by the old guy opposite.
Swapping shares and Fox getting the premiere rights for the first five seasons are two different things when you take it seriously, but Murdoch cleverly confuses the two things, giving Eric the illusion that Fox is very sincere. But if Eric really chooses the 5% shares, he may not benefit at all in the end, but will give Fox a dividend every year because of the profit gap. In addition, this share must have a long lock-up period, and when it can be sold, perhaps the market value of Firefly is already about the same as Fox.
And Fox must have the right of first refusal to take back the shares, even if Eric sells the shares back to the other party, the final result is that Fox owns the shares of the Firefly and can dictate the affairs of the Firefly, but the Firefly cannot interfere with the Fox in the slightest. Another point is that after the share swap, the interests of Firefly and Fox are also tied together, even if he is reluctant, if necessary, Eric has to pinch his nose and give priority to cooperating with Fox. It is estimated that this is also the main purpose of Murdoch's desire to exchange shares with Firefly.
If Eric still had the naΓ―ve, cowardly and juvenile soul in his body, perhaps when he figured it out, he would definitely be so angry that he burst into tears and shouted: "It's too bullying, I won't cooperate with you." β
To be honest, Eric may have had this impulse full of youthful spirit just now because of the residual thinking of the original owner.
However, now this body is still dominated by the soul of a calm middle-aged man in his forties, and because of the special experience of rebirth, Eric has seen many things relatively lightly, and it is even more unlikely that something that will happen to him when he is angry for money.
Of course, Eric was still very angry at this time: "Mr. Murdoch, maybe Fox didn't want to show any sincerity at all, so ......"
Murdoch showed a faint wry smile and said, "Eric, you listen to me, or we ......"
"No," Eric immediately interrupted Murdoch, he wasn't sure if there would be any big holes waiting for him in the old guy's next proposal, and if he didn't react, then he would be planted: "Let's talk about me, I'm not very interested in the shares of Fox Films, but since what we are discussing today, let's talk about the Fox TV network." I want a stake in the Fox network, and if Fox wants to get the premiere rights for the next few seasons, it will have to transfer me a 10% stake at 80% of the market value of the Fox network before it starts. β
Murdoch was taken aback by Eric's lion opening, although he is known as a media tycoon, but he currently only owns a little more than 30% of News Corp., and News Corp. only owns about 80% of Fox Network, which is equivalent to his family's stake in Fox Television Network is only 24%. If Eric agrees to his terms, Firefly will become the second-largest shareholder of the Fox network, second only to the Murdoch family. If there is a conflict between the two sides in the future, Eric is likely to seize the lead of the Fox network as long as he has the support of other shareholders.
The Fox network was Murdoch's most important move to enter the North American market, and in any case, he could not have agreed to Eric's terms.
To be honest, Eric didn't have such a big appetite originally, and his original plan was just to get about 5% of the shares of the Fox TV network.
From the collected information, the current value of the Fox TV network is less than 1 billion, which is far less than the huge scale of 40~5 billion US dollars of the three major TV stations.
But Eric knows that in more than a decade, the scale of Fox TV will be side by side with the three major TV stations, reaching more than $30 billion, and now it only needs to invest less than $50 million, and then this 5% stake will be a huge wealth worth more than $1.5 billion, and compared with the film company, the profit of the TV network is more stable, and in the future, he can get a lot of dividends from the billions of dollars in profits of the fox TV network by doing nothing. (To be continued)