Huayu Zhihao

Chapter 850 The Seventh Biggest Hollywood
"You should first contact Sony to acquire MGM Holdings in the name of Tianchi Film Group." Chen Hao said.

"What? Acquire MGM Holdings?" Smart was taken aback when he heard the words, and immediately jumped up from his seat, "Are you crazy? What are you doing?"

"Didn't you agree not to yell?" Chen Hao laughed when he heard this.

Smart lay directly on Chen Hao's desk, staring at Chen Hao's eyes and said anxiously, "Chen, are you serious? Are you sure you're not joking?"

Chen Hao shook his head when he heard the words, of course he was not joking, but after careful consideration.

In fact, as early as 2005, Chen Hao wanted to take advantage of Sony's success and join MGM Holdings, a consortium headed by Sony, to acquire MGM.

It's a pity that Liang Tianchi Films was first established at that time, and it was far from enough in terms of performance in Hollywood and financial strength. Several major consortiums were not willing to play with Liang Tianchi, a small shrimp.

Now, the annual box office performance of Liang Tianchi Films has surpassed Lionsgate, and it has become the number one independent film company for two consecutive years, and it is also very close to the last place in the top six Hollywood, and its strength has grown rapidly.

At the same time, Liang Tianchi Pictures also holds Marvel Entertainment, a big killer that has begun to emerge.

More importantly, the current situation of MGM Holdings is not good. Not long ago, on August 8, MGM officially announced bankruptcy trusteeship!
MGM Films is the Hollywood giant with a roaring lion at the beginning, and it has an extremely glorious history.

It produced one of the greatest films in movie history - Gone with the Wind.

Create an enduring screen classic - 007.

Created an immortal cartoon image - cat and mouse.

It also initiated the establishment of the American Academy of Motion Picture Arts and Sciences and launched the Academy Awards.

In the 80s, it also annexed another big Hollywood giant at that time, United Artists.

It has won 181 Oscar gold awards, of which 12 films won the Oscar for Best Picture.

……

It's a pity that in the 90s, many competitors emerged one after another, such as Pixar and DreamWorks, etc., all seized the business opportunities of new special effects technology and animation technology. In comparison, MGM seemed old-fashioned and unchanged.

After the 21st century, MGM has been short of blockbuster films, and its business has fallen into a predicament.

On February 2005, 2, a consortium led by Sony established MGM Holdings.

2005年4月8日，米高梅控股公司通过一笔价值48亿美元的杠杆收购, 只出资了不到8亿美元就收购了米高梅电影公司。

Sony and other consortiums did not manage it carefully after acquiring MGM. They had a specific purpose in acquiring this non-performing asset.

Sony is focusing on the remaining 4100 titles in MGM's library, as well as 17000 hours of TV episodes.

With this, Sony expanded its film library to the world's largest 7600 titles, not only controlling 50% of the film sources in the US film market, but also seizing the commanding heights of pay TV and new-generation DVD film sources.

Relying on the huge film source that occupies half of Hollywood, it vigorously promotes the DVD under the parent company.

But after achieving these goals, Sony turned to a low profile. This time, MGM was plagued by 40 billion US dollars in debt. save.

Until August 2010, 8, MGM declared bankruptcy due to its inability to repay huge debts and launch new works.

From the establishment of MGM Holdings until its bankruptcy, its equity composition is as follows: Providence Equity Partners holds 29% of the shares; Texas Pacific Capital Fund holds 21% of the shares.

Sony America holds 20% of the shares; Comcast holds 20% of the shares; DLJ Commodity Bank Partnership holds 7% of the shares; Sifang Group holds 3% of the shares.

Two years after the financial crisis in 2008, MGM began to seek the opinions of more than 100 creditors to apply for the protection of Chapter 11 of the U.S. Bankruptcy Law and carry out bankruptcy reorganization to get rid of the debt pressure of 40 billion U.S. dollars.

If creditors agree to apply for bankruptcy protection, they will receive 95% of the equity of the new company after reorganization as compensation.

The company that takes over MGM will get a 5% stake and the right to operate it.

At this time, MGM has entered the period of bankruptcy protection, waiting for the implementation of the reorganization plan, and someone will take over.

However, no one wants to take over this huge non-performing asset at all.

A huge debt of up to 40 billion U.S. dollars, a mess of creditor's rights and equity relationships, a disjointed team of filmmakers, the aftermath of poorly leveraged speculation in 2005 (MGM's non-performing assets actually included "subprime mortgage" real estate investment ).

Although there have been countless classic series, the only one that can continue to be filmed today is the 007 series that is not pure "lion blood" (originally the signature of Chaplin United Artists).

And the Lord of the Rings series with only half of the ownership (the birthplace is the new line that has been acquired, and the other half of the ownership has already belonged to the old enemy Time Warner).

As for the four films that are currently being filmed, almost none of them are favored by the market and film critics.

With such a mess, it's not surprising that no one cares about it.

In fact, MGM's debt is far more than 40 billion US dollars. The current debt is the debt after removing its own assets.

MGM here is not just MGM Pictures, MGM has a lot of assets.

Including MGM Entertainment, MGM United Artists, MGM Pictures, Modern Times Movies, Dixon International, Comcast TV.

MGM Hotel, MGM Grand, Mandalay Resort, Dream Resort, Excalibur Hotel, Treasure Island Hotel, Mandalay Bay Hotel, Bellagio Hotel, New York Hotel, MGM Coffee.

……

Seeing that Chen Hao wasn't joking, Smart was going crazy. He managed to control his mood and asked, "Chen, what are you thinking? Why did you buy MGM, a junk stock that no one dares to touch?"

"Of course it's for Liang Tianchi Pictures!" Chen Hao replied, "Smart, have you ever thought about making Liang Tianchi Pictures the seventh largest Hollywood giant?"

Smart's eyes couldn't help but widen when he heard the words, and he blinked before saying, "The seventh giant? This..."

To be honest, Smart also had such fantasies. After all, Tianchi Films has ranked No. 2 in Hollywood's annual box office for two consecutive years, and it is not far from the No. 7 Hollywood giant.

It's just that he has been in Hollywood for many years, and Smart also knows that he wants to become the seventh giant, but it doesn't just need to be good at the box office.

It also needs all kinds of conditional support, abundant funds, distribution network all over the world, MPAA and so on.

Here is an explanation of MPAA, which is the Motion Picture Association of America. It is involved in not only movies that are shown in theaters, but also TV home photography and other delivery systems that may appear in the future.

Why is it so important?

First of all, it has the ability to rate movies!

Think about how a movie might be classified as G (general, available to all ages) or R (restricted, under 17s must be accompanied by a parent or guardian).

So how big of a gap will there be in their box office results?

And this is just one movie, if there are 10, 20, 100...then the gap may be billions of dollars!
At the same time, you can not only rate your own company's movies, but you can also rate your competitors!
This is definitely a terrifying right of 1+1>2.

Secondly, the main members of the American Film Association are the chairmen and presidents of seven film and television media giants in the United States.

Including: Warner Bros., Disney, Sony Columbia, Paramount, Universal, 20th Century Fox, and MGM!

These 7 main members are all Hollywood giants!

In addition, the Motion Picture Association of America can use political lobbying to amend US copyright law and criminal law to protect the commercial interests of its members.

It has a great voice in all kinds of controversies such as piracy and infringement.

To use an inappropriate metaphor, the seven MPAA members of the North American film and television industry are similar to the five permanent members of the United Nations!
……

Smart suddenly understood that, as one of the top seven in Hollywood, MGM did have all the other conditions of a giant except money.

Especially the distribution channel that has been troubled by Tianchi Pictures, MGM not only owns Di Gao International Cinemas, but also has a distribution network all over the world.

In addition, there are MGM Entertainment and MGM United Artists involved in DVD, video tape, and home audio-visual entertainment.

And Comcast TV, that's cable.

If you have these, then Liangtianchi Pictures' annual copyright income will directly more than triple, and you will no longer have to hand over the bulk of the profits to Sony Columbia.

This is why Chen Hao was attracted to MGM in 2005.

Even after the failure, Chen Hao has been trying to solve the distribution problem of Tianchi Films. For example, in the future, Wanda will acquire AMC and become the world's largest theater chain operator, so he will cooperate with Wanda.

However, that will have to wait until 2012, and the future of Wanda will not be easy.

Now that MGM is under bankruptcy protection, Chen Hao sees a good opportunity to acquire MGM.

If it is possible to acquire MGM, then Liang Tianchi Pictures is indeed likely to become a new Hollywood giant.

But MGM's high debt still made Smart wake up immediately, "Even if things develop in the most perfect direction you can imagine, but do you have money?

Although MGM is a non-performing asset, this non-performing asset is a bit huge. If you want to buy MGM, it is impossible without paying some real money.

The shareholders of MGM are blood-sucking consortiums. If you don’t feed them, they would rather rot than sell them to you.

They're definitely looking to either suck or cash out, so you have to have a lot of cash.

But judging by the current situation of Tianchi Films, it is difficult to even maintain it, and there is no money at all! "

"Don't worry, we won't let Liang Tianchi Pictures directly pay for it." Chen Hao reassured.

Smart was relieved when he heard the words. Originally, the Marvel superhero movie universe made Liang Tianchi Pictures a little breathless. If you want to build a bigger MGM, that day will be impossible.

"Then how did you solve the money problem?" Smart asked curiously.

Although he still doesn't agree with the acquisition of MGM, the temptation to become a new Hollywood giant still makes Smart feel a little itchy.

After all, who wouldn't want to be the president of a Hollywood giant and become one of the most powerful people in Hollywood!
Facing Smart's question, Chen Hao did not answer directly, but instead asked, "Smart, if everything goes well, how much do you think the value of the Marvel superhero movie universe will be?"

Smart's heart was moved when he heard the words, and then he thought for a while and replied, "If the Marvel superhero movie universe you proposed can really succeed, then this concept + Marvel Entertainment can be worth tens of billions of dollars!"

Hollywood is a place where IP development is very mature. A successfully operated IP can generate at least hundreds of millions of dollars in value.

And something like "Harry Potter" is as high as tens of billions of dollars.

Even just the "Harry Potter" movie and its copyrights are worth billions of dollars.

The Marvel Superhero Movie Universe contains more than 5000 superheroes, although not every superhero has a high development value.

It is not accurate to directly compare "Harry Potter", but just looking at the size of Marvel superheroes is extremely huge.

而且这还是在1+1=2的情况下，并没有考虑1+1大于2的情况。

If the Marvel superhero movie universe is really successful, the profits created will definitely exceed tens of billions.

"The Marvel superhero movie universe, which is worth tens of billions of dollars, can be preserved only by our measurement?" Chen Hao asked again.

Smart frowned when he heard this, and the answer was obviously no.

Hollywood giants are powerful, but they are also full of aggressiveness. In order to maintain their giant advantages, they will show their fangs when facing many well-developed independent film companies.

Under the coercion and temptation of Hollywood giants, independent film companies often cannot escape the fate of being acquired or dismembered.

Just like New Line, which was annexed not long ago, although it produced the "Lord of the Rings" trilogy, it was annexed by Time Warner because of the fiasco of "The Golden Compass".

Another example is DreamWorks, which was once in full swing and was founded by three Hollywood bigwigs, but was eventually castrated and dismembered.

Similarly, Liang Tianchi Pictures had already received an acquisition offer, but Chen Hao refused.

And the Hollywood tycoons are not in a hurry. They encountered the "Golden Compass"-style Waterloo in Quantum Tianchi Films, and it will be easy to acquire Quantianchi Pictures.

It's a pity that they haven't waited for such a good opportunity until now.

It's just that Liang Tianchi Films has become the largest independent film company, and the giants can wait patiently.

But if the Marvel superhero movie universe really succeeds, involving tens of billions of dollars in interests, then they will be like sharks that smell blood, open their bloody mouths, and wait for the opportunity.

They haven't done anything yet, they are waiting for Liangtianru Pictures to continue to incubate this super concept. Once the concept is a big success, then it's time for them to show their fangs.

　Thanks to "Qinglian Earth" for the 1500 reward!

　　
　
(End of this chapter)