I Am a Nobleman in England

"Sure enough, the lion opened its mouth!"

Arthur frowned, said with a sneer, and then stretched out his hand to signal his subordinates to sit down.

After the person in charge of leading the negotiation sat down, he said helplessly: "It's all expected, but I didn't expect that their appetite is so big. Behind their daring to ask for this price and their confidence, there is a According to this shrewd calculation, they have recovered their equity investment, and they can make another profit by borrowing AMC's listing.

Moreover, in fiscal year 2009, despite the raging economic crisis, AMC's performance was very good, achieving a net profit of US$79.91 million that year. Shareholders of private equity funds are full of confidence. They believe that the financial performance in 2010 will be more eye-catching, and the IPO should be a matter of course.

The combination of these factors made them full of confidence. However, they also expressed enough welcome attitude towards our appearance that we can sit down and talk about everything. . . In fact, they also know that if the IPO is not successful, it will not be easy to find a good buyer. The buyer must not only have enough money, but also have a sufficient operating level. Only in this way can the repayment be safer .

Therefore, in their eyes, you, the boss, are one of the good buyers. Of course, it would be great for AMC if they could go public. After all, the return on the stock market is much higher than that of the bond market. Their calculation is that if AMC can be listed, it will be listed, and if it cannot be listed, it will be sold, and it will walk on two legs.

However, the key is the bond issue. AMC theaters have been overdrafted and cashed out by these guys for all the profits in the next few years. "The person in charge of the negotiation took out a document bag from his bag, opened it, took out a stack of documents from it, handed it to Arthur, and shook his head helplessly.

"Bonds..." Arthur muttered, took the document and looked at it, and frowned, "What a bunch of bastards!"

If it is in a casino, then the assessment and control of risks is the key to ensuring that you have the capital to gamble. Similar to the casino, the bond also faces the same problem. This is a game that cannot be missed in the slightest, and it is also one of the biggest problems that Arthur needs to face in the AMC M\u0026A transaction.

Because bond investors want higher interest and more absolutely safe repayment. And these bond investors are also old acquaintances with AMC's five largest private equity fund shareholders, earning every penny together.

If Arthur wants to acquire AMC, he must face these bond investors directly and find a way to convince them that he can restructure these short-term or soon-to-maturity debts and extend the repayment date.

You can imagine how difficult it is to convince these people. This involves the change of control of the bond, which is a major default clause in the bond. The confidence of creditors is key.

And officially entered the AMC. Strictly speaking, this is just a leveraged asset reorganization. After the reorganization, debts have increased and the equity structure has been reshuffled. It is a friendly and cooperative leveraged buyout, not a hostile one. Next, the test for Arthur's side is to directly compete with the Wall Street giants as the owner of AMC.

Here we must mention the Qiang rules of Wall Street's leveraged mergers and acquisitions. Mergers and acquisitions are the magic weapon for Wall Street to make profits, because Wall Street can earn handling fees whether it succeeds or fails. Leveraged buyout companies charge management fees, investment banks charge consulting fees, securities firms charge high-yield bond issuance fees, and so on.

Investment banks, private equity funds and brokerages, among them you have me, and I have you, the relationship is intricate, and many of them have even maintained friendship for decades. Therefore, Wall Street's mergers and acquisitions business can be seen as a never-ending game of chess between a group of old friends.

Of course, their group of vampires is not in harmony, and there are also fierce quarrels and interest competitions among them. At that time, Arthur can also pull a group, fight a group,

Then it disintegrated from the inside, but these are all later.

Now, what he has to face is whether he can accept and tolerate the price blackmail from the other side like a confident lion, and grit his teeth to acquire AMC Cinemas.

"Boss, AMC's private equity fund shareholders are also facing two crises. One is that 2012 is the fund's exit period. The other is that there is a huge amount of due debts that need to be refinanced. No matter from which angle you analyze it, AMC's private equity fund shareholders are facing The problems are very difficult.

If they don’t want to use their own money to fill this hole, then either the IPO will succeed, or they will use their own money to fill it. Hehe, it’s okay to let them put money in their own pockets, but it’s basically impossible to let them take money out. .

Since it is impossible to take money out, the only way out is to choose a good buyer to take over and get rid of these debts. A term loan with an aggregate principal amount of $476.6 million matured on January 26, 2013, and $160 million of bonds due in 2014 had not been redeemed. "

Hearing the report from his subordinates, Arthur nodded. You must know that in leveraged buyouts, private equity funds only use a small amount of their own funds, and most of the funds come from debt financing, including the bond market and banks, as well as A small amount of mezzanine debt.

If it comes to the repayment period, it will definitely be the biggest problem that the acquired company and the acquirer need to face. If the capital chain is broken, it means that the game has collapsed, and the only way is to apply for bankruptcy protection and carry out debt restructuring. Walk.

"Although it is shameless, the five major private equity companies hold the card of AMC's listing, and they can calmly carry out debt restructuring." After Arthur nodded, he smiled, looked at his subordinates and continued: "We acquired AMC, and equity is not the focus. However, the huge debt is a wall in front of us.

In the acquisition of AMC, its equity price and debt are a package deal. AMC's debt problem is solved, and the equity transaction price is much easier to negotiate. . . Regardless of whether it is equity or debt, I only have two requirements. Before the acquisition of AMC is completed, one is to spend as little cash as possible, and I also hope that AMC’s cash will flow out as little as possible. There must be sufficient capacity to cover forward financing. "

"Well, that's true."

Arthur pondered for a while, then relaxed his frown, and said to his negotiator with a smile, "When will the negotiations officially start?"

"Tomorrow at ten o'clock in the morning."

"I will attend with you." Arthur made a decision.

"Okay, boss, but during the negotiation process, I also hope that you will not make any easy decisions on the spot..."

"Hehe, don't worry, I just let them understand my attitude, and I won't interfere with your negotiations." Arthur didn't care about the worried reminder from his subordinates, and he still has some capacity for this.

In the morning of the next day, Arthur, who was dressed in a high-definition black suit and looked very tall, chic and capable, led a group of his subordinates, and met Abo in the conference room of Tianpeng Holdings, which was jointly established by the five major holdings and private equity funds that controlled AMC Cinemas. The heads of Luo Investment Fund, MG Chase Investment Fund, Bain Capital, Carlyle, and Spectrum Investment Fund.

The two parties first shook hands, greeted each other and made an introduction, and then they arranged on both sides of the conference table, and sat down clearly. Arthur sat in the deputy position, and the person in charge of the negotiation took the lead position. After all, in business negotiations, he, Arthur, was a layman. So I won't mess around.

It's just that when Arthur saw the designated leaders of the five major funds sitting in the middle of the opposite line, his eyes darkened. Sure enough, none of the five funds were vegetarians, and everyone was worried that their own interests would be damaged. , no one believes anyone.

Everyone knows that one monk carries water to eat, but five monks have no water to eat.

Of the five persons in charge, anyone can speak, express their position and attitude, and make demands, but no one counts what they say, tsk tsk, this is the most deadly thing.

"First of all, I want to make a statement. In this acquisition, what I want to acquire is 100% equity of AMC. If this condition is not met, the entire acquisition transaction will be automatically terminated. To be honest, a theater chain like me that can be regarded as a declining industry There are not many big buyers in the company, and I also believe that once my acquisition transaction is cancelled, and the news spreads out, it will not only scare off other buyers, but also shatter everyone’s desire to get a huge amount of cash in the short term.” Seeing the clues Come on, Arthur, who originally wanted to stay calm and see the atmosphere of the negotiation, decided to throw a bomb first, to stimulate the five people who have their own thoughts on the opposite side!