I Am a Nobleman in England

"What do you think of the acquisition invitation sent by the British?"

In the meeting room of AMC Theaters Holdings in New York, the controlling shareholders gathered around the conference table, while the management of AMC Theaters in the headquarters in Leawood, Kansas could only listen to these capital players through remote video. Make decisions to determine the future of their theater company.

"I have no idea, as long as the price is right, why not agree."

"My opinion is the same, the IPO is nowhere in sight, I don't want to waste any more time, as long as the price is right..."

"Recently I heard that several theater chain companies in the United States and Europe are waiting for sale. The other party chose AMC. I believe the reason for choosing AMC is the same as ours. It is the largest company and is not a listed company. The core area of ​​the central city. At the beginning, five of us bought it one after another, but finally came together and owned equal shares.

It even created a small miracle in the history of leveraged buyouts. Isn't it just to sell it? But no one has the ability to accept it, and IPOs in the stock exchange open market always lack a little luck.

Now that someone is willing to take over, why hesitate? Isn't this exactly what we want? "

Listening to what this group of controlling shareholders said, the managers at the headquarters in Leawood, Kansas, on the other side of the video window, looked gloomy and ugly, but they, the managers, could only accept this group of greedy people helplessly. The decisions of the ruthless financial capitalists, who let them be the real controllers.

This is the first-class players in the leveraged buyout world that Arthur needs to face next--Apollo Investment Fund, MG Chase Investment Fund, Bain Capital, Carlyle, and Spectrum Investment Fund.

And these five private equity fund companies jointly hold AMC, and the shares are equal. After the leveraged acquisition of AMC by five top private equity funds, they rushed straight to the New York Stock Exchange. But it seems that there is always a lack of luck. With the exit period of the fund approaching, they can only bid farewell to AMC's IPO feast.

At the right moment, Arthur Boleyn appeared.

Of course, the top players in the leveraged buyout arena are naturally unwilling to quit, they have an insatiable appetite. It seemed to them that Arthur Boleyn was prey from England.

In fact, these five funds have recovered their invested funds, basically holding shares at "zero cost", but they have been trying to make AMC go public to cash out.

Sending AMC to the NYSE for an IPO is certainly the best exit option. It is the dream and the Holy Grail of private equity fund companies to raise real permanent capital from the public market. First, it can provide rich returns, second, it can avoid tedious fundraising activities, and third, it can expand the scope of investors.

It’s just that it’s just as they said, maybe it’s really bad luck, and there has been no way to succeed in the IPO. For Arthur Boleyn who knocked on the door at this time, naturally he will not let go easily, but will speak loudly.

"How about a billion dollars?"

"Maybe we should ask for more, anyway, we need to negotiate..."

"Hehe, what if we scare the other party away? Where can we find such a buyer?"

Listening to the discussion of these greedy and shameless vampires, the management of the theater chain was really bleeding from the heart, and at the same time cursed constantly in their hearts. You must know that their so-called 1 billion US dollars is only the price of equity mergers and acquisitions. In addition, AMC has $1.5 billion in liabilities.

"Hehe, negotiation, every negotiation is a war, but the situation is good or bad. We are not in a hurry, just talk to him in a leisurely manner. You know, except for AMC's beautiful business performance, wait for it The good news of the listing, we still have a magic weapon in our hands to continue to make profits,

Dividend recapitalization. . . "

"Hahaha..."

"hehe..."

In the meeting room, the heads of the five foundations laughed heartily knowingly, not paying any attention to the fact that on the other side of the video, there were already a few cinema companies who had lowered their heads, their faces were getting uglier, they were secretly gnashing their teeth, and their eyes were shining with hatred. Of course, they are capitalists, and they know that the management of theater companies hate them very much, but unfortunately, they are the controlling shareholders and the owners of AMC. They can play however they want, A group of migrant workers, as long as they are obedient, get out if they are not obedient, and replace them with obedient ones.

And the reason why the heads of the five major foundations were extremely happy when they heard about the dividend recapitalization, and the reason why the management who has feelings for AMC are extremely hated and helpless is that the so-called dividend recapitalization means that the acquirer does not have to sell all assets, as long as the company is generally Once the debt is repaid, the cash can be used to borrow again, and the loaned funds can be used to pay dividends.

To put it simply and straightforwardly, for example, a certain property on the second ring road in Beijing has been increasing in value, and the owner can repeatedly reapply for a mortgage for it to realize capital gains.

Therefore, the acquired AMC company has been doing its best to promote the growth of cash flow, so repeatedly, the five major foundations will soon recover the investment cost, but the debt of AMC theater company is getting heavier and heavier.

This method has been compared to that the goose that laid the golden eggs only laid a huge goose, but got the foie gras everywhere. This is how private equity shareholders arbitrage AMC.

Arthur looked at the detailed information about the five holding funds in his hand, and frowned even more. He also knew that this time he was facing the world's top trading opponent, and he had already prepared that the acquisition negotiations would be very slow and difficult. There are many difficulties, and he cannot cut through the mess quickly. At the same time, he also needs to maintain enough caution and awe of risks.

In fact, what he needs to face this time are two symbols of the United States, Wall Street and Hollywood. If you want to become the master of AMC and become its new owner, you may have a long way to go!

In fact, everyone knows that in a large-scale leveraged buyout battle, speed is everything.

If competitors appear, long-term competition will raise the price of the acquired company, which means that the acquirer needs to borrow more funds to acquire the company, and the debts it bears will be heavier. In the end, both parties will suffer, or they will fight each other. If you fight, the fisherman will benefit. If there were open bidding, the takeover battle would turn into a hand-to-hand battle, with the buyer suffering the most.

To be honest, Arthur can start negotiations with the other party with the attitude of not bad money, as long as the price is not too high, he can quickly complete the acquisition. Anyway, the funds for his acquisition are loans from Barclays Bank, and Barclays Bank is also willing to give He takes out a loan.

Why do you like to borrow money and use leverage to buy companies?

This is because, according to the U.S. tax law, only interest expenses can be deducted from corporate pre-tax profits, while dividends cannot be deducted before taxes. The U.S. income tax law undoubtedly ignited the spark for leveraged buyouts, and it was thanks to high-yield bonds that made the leveraged buyouts a prairie fire. Michael Milken, the former high-yield bond emperor on Wall Street, has raised huge amounts of money instantly in leveraged buyouts many times. These bond funds provide great convenience for leveraged buyouts, such as high-quality fuel, turning Volkswagen's Beetle into a fast Ferrari.

Borrowing money always has to be repaid, so what do you take to repay it? How to pay it back?

One is to extend the loan period, the other is to issue new bonds to repay old debts, and the third is to issue an IPO. . .

So for Arthur, the funds are very sufficient, but he doesn't want the greedy vampires on Wall Street to take too much advantage of him, and no one's money comes from the wind.

Negotiation is a war, whoever let go first will lose!

Not only fast but also tight inside and loose outside, with swords and swords inside, and the surface is calm. Also confidentiality is key. There is a famous saying on Wall Street that if a merger is on the news without a result, you will be in big trouble. Once news of a company acquisition leaks, many people will participate in the bid, even their brothers.

Therefore, once the negotiation starts, the non-disclosure agreement must be signed first!

"Boom——"

"Come in!"

Arthur put down the document in his hand, looked at the subordinate who pushed the door in, and asked, "Is there any result?"

"Yes, the boss, they accepted our acquisition offer, offered a price of 1 billion US dollars, and asked us to undertake all the debts of 1.5 billion..."