Chapter 257 Legendary Pictures
After more than a month of planning and negotiations, Legend Pictures officially listed in Hollywood with the joint support of many forces.
This is a day that is highly anticipated!
It is also an epoch-making day for the development of Hollywood!
There are 6 shareholders of Legend Pictures, with a total investment of US$360 million.
Among them, Tangen Capital invested US$100 million, which is the largest shareholder, accounting for 27.8% of the total share capital.
In addition to the capital injection of these shareholders, Michael Orwitz also successfully obtained a debt priority loan of US$140 million from Merrill Lynch, with the repayment interest of between 6% and 10%, which is very preferential.
At this point, Legend Pictures has a total of US$500 million on its books!
In the platter investment plan, the producer's investment must account for the majority of the investment, and the platter party's investment is between 10% and 40%. This can ensure that the producer bears most of the risks and strives for excellence, and the platter party can also share enough investment pressure.
Today's Hollywood movies have an average investment of about 30 million US dollars. A large film company produces about 15-20 movies every year.
In other words, a large film company's total investment in film production every year will be between 500 million and 600 million US dollars.
This number is really not much!
Just look at how much production investment is Tangen Pictures this year?
"Never Sink" $200 million, "Mr. Smiths" $100 million, "Legend of Narnia" $70 million, "Beautiful Mind" $40 million, and "Drug Net" $50 million.
Not counting as a TV series, Tang En Pictures’ investment in films this year has reached 420 million US dollars!
These are just 5 movies!
If we include the "Pirates League" series and "Spider-Man" sequels and other blockbusters that will be launched in the spring of next year, the investment amount will be very terrifying!
This shows the different business methods of Tangen Pictures and other Hollywood giants.
Tang En Pictures is Tang En's private property, and he is foresighted and can invest in huge blockbusters with confidence!
There is no need for external investment to share risks.
On the other hand, some movie giants, even Disney, spend $140 million to invest in Pearl Harbor, are still very nervous, and they want to pay close attention to this project from Michael Eisner to the cleaning lady.
Legend Pictures has a book capital of US$500 million. According to Michael Orwitz, $20 million of working capital is reserved, and the remaining US$480 million can be invested in the platter investment plan.
Tang En is very concerned about this project, not only because he is the major shareholder of Legend Pictures, but also because the "platter investment" model will be his key move to dominate Hollywood in the future!
According to the United States' antitrust law, whether it is music or movies, the copyright share of such entertainment companies cannot account for one-third of the market.
In other words, in 2000, a total of 374 movies were released in the United States. If Tangen Pictures released more than 125 movies this year, it would touch the antitrust terms!
Of course, judging from the current eye sockets, no company can publish such a large number of videos. Even giants such as Warner, Disney, and Paramount have a yearly release of films of about 30.
But...what if?
Donn had just entered Hollywood for four years and had already made a huge career and could even compete with Disney.
In a few years, who can guarantee that Don En Pictures will not rule Hollywood?
On the verge of issuing monopoly terms, the platter investment model is the best tool.
Through Legend Pictures’ platter investment, Tang En can successfully participate in the film production of other film companies.
With the more partners of Legend Pictures, the wider Tang En's sphere of influence will be.
If Legend Pictures and the Big Six are in touch…
That means that more than 95% of Hollywood movies, Don has the right to participate!
In this way, even if Tang En Pictures wants to limit its scale in the film field in the future, Tang En can participate in most film productions, and he will become the veritable master of Hollywood!
Because the movie is Hollywood!
Of course, all this remains only in Tang En's paper vision. Legend Pictures has just been established and now it needs to determine its first customer.
Donn flew back to Los Angeles from Boston to have a detailed discussion with Michael Orwitz.
According to Michael Orwitz, Legend Pictures currently has $500 million in funds and $480 million in available funds. The amount of funds is not small, but it is not advisable to involve too many partners.
Judging from the current situation, it is best to choose only two partners, each contract is signed for two years, and invest US$120 million in each film company every year, accounting for 20% of the share, which is more appropriate.
For Don En, the more partners, the better. If all the six giants can be pulled into his chariot, his position in Hollywood will be as solid as a stolen one.
However, the total available funds are US$480 million, and short-term contracts will greatly increase the investment risks of Legend Pictures. It is necessary to find a balance between the number of cooperative allies and investment benefits.
Donn recognized Michael Orwitz's view, "You can find a movie giant first to complete the signing. The second partner can slowly find him whoever gives the conditions will cooperate with whom he or she will give!"
This of course also includes Tang En's selfishness. As long as the second partner of Legend Pictures has not been determined for a long time, those Hollywood giants who hope to obtain capital will definitely revolve around him and keep pleasing him.
"Who are you going to hand over this first business?" Michael Orwitz looked at Donn with a smile.
To Michael Orwitz, as long as he successfully attracts funds from Wall Street, he is equivalent to success!
Although Legend Pictures has $100 million investment from Donn Capital and Michael Orwitz’s own 80 million capital, don’t forget that this is Hollywood!
The power of Legend Pictures is in their hands!
Even if the platter investment really fails and the losses are serious, Michael Orwitz's status and means in Hollywood are enough to operate easily, allowing Tang Capital and his personal funds to successfully cash out. Wall Street will bear the losses of Legend Pictures.
There are so many tricks in Hollywood!
Especially to foreign investors, we will never be polite!
Wall Street is relatively good, after all, they are all American compatriots. When a large amount of funds from Asia and the Middle East enter Hollywood... Hehe, that's what it means to be a real slaughter!
Therefore, for Michael Orwitz, the successful opening of Legend Pictures is a business that can make money without losing money. Of course, he respects Tang En, a little friend.
Tang En smiled, "Recently... there are many film companies we have contacted?"
"That's more?" Michael Orwitz's face showed a proud brilliance, as if he returned to his domineering attitude when he dominated Hollywood. "Apart from Disney, the other five studios have all shown goodwill. You don't know that my banquet invitations during this period are so scary!"
Tang En sat in his office, crossing his legs, looking very comfortable. "Platform investment is a new concept, but I didn't expect those old guys to be quite keen on."
Michael Ovitz waved his hand and said, "Wow, how many people really understand the concept of platter investment? Only those who have money are the master!"
Tang En glanced at him with a smile, "You already know our first partner, right?"
"Oh?" Michael Orwitz blinked, "It's okay, I can respect your decision."
Tang En smiled strangely, "Michael, you are not honest. I don't believe me, you can't guess!"
Michael Orwitz was slightly stunned, and then burst into laughter.
"Don't think that Hollywood has six giants, there is only one company that is truly suitable for us to cooperate with now." Tang En said lightly.
Michael Orwitz nodded, "Yes, this partner must meet the investment potential of Legend Pictures, and can also provide enough support for Don'tel Pictures."
Then he glanced at Tang En deeply and said, "It just so happened that Warner Brothers' recent days are not easy."
Tang En smiled and said, "In the past, Hollywood deceived other fields. Unexpectedly, Time Warner was deceived by an Internet company! I heard... In order to make up for the losses, Time Warner intends to sell its Warner Publishing Group?"
Michael Orwitz said: "The merger between AOL and Time Warner is a failure. AOL is a light asset Internet company. If you want to sell assets to make up for the loss, you must sell Warner's related business, maybe Warner Publishing Group, maybe Warner Music Group. In short... Warner Bros. will never be able to get a penny of capital injection from the parent company in the next few years."
Tang En nodded happily, picked up the strong-scented coffee, took a sip, and said with satisfaction: "So, Warner is the first partner of Legend Pictures!"
"That's the point!"
Michael Orwitz immediately exclaimed.
The merger of AOL and Time Warner has lost $40 billion, but the lean camel is bigger than a horse. Warner Bros. is still the largest film studio in Hollywood.
In terms of strength, background, and influence, Warner plays an important role in Hollywood.
If Tang En Pictures has the escort of Warner behind it, it will have basic guarantees when encountering unreasonable sanctions like Disney in the future, and there will be no need to work hard like in the past few months.
Moreover, since Donn took out his "platter investment plan" and issued a ban order to Disney, Warner has shown enough sincerity.
In the face of Disney's attack, Warner not only did not take any action, but also protected the rights and interests of Tangen Pictures everywhere. This is human nature.
So from which aspect, Warner Bros. is the best choice for Legend Pictures’ first major customer!
"Since that's the case, Michael, please let's arrange it. Let's talk to the head of Warner to some details of the cooperation."
Tang En stood up and felt that the Hollywood land under his feet was thicker and more stable.
Chapter completed!