Capítulo 314: Chapter 314: MGM Changes Hands
In recent years, Apple has remained strong, and older operating systems like Unix continue to occupy a significant portion of the market share.
Therefore, besides the focus on new technologies and the rise in stock prices, Westeros Company's acquisition of an additional 10% stake in Microsoft did not cause a strong reaction, as most people did not see Microsoft's potential to become a groundbreaking tech giant.
After finalizing this matter, Simon's attention returned to Hollywood.
Another week in December quietly passed.
From December 8 to December 14, in its fourth week, "Look Who's Talking" experienced a 22% drop in revenue, earning $16.93 million, accumulating a box office of $110.25 million, officially breaking $100 million, becoming the first film of the end-of-year season to achieve this milestone.
With the upcoming popular Christmas season, even with heavyweights like "Batman" and "The Rocketeer" set to release, "Look Who's Talking," a family comedy fitting the holiday mood, still possessed significant box office potential.
Industry insiders originally estimated the film's North American box office might be between $150 million and $170 million. When the new week's box office data was released, both the production and distribution side and external box office tracking agencies confirmed that "Look Who's Talking" was expected to reach $170 million or even higher in North America.
Simon remembered that the original "Look Who's Talking" had a North American box office of around $140 million.
However, the original film was released in mid-October, a less popular season compared to Thanksgiving, and it couldn't compare with the star power of Mel Gibson, nor did it have the strong promotional support from Daenerys and Warner Brothers. Therefore, the new version surpassing the original by $30 million was within expectations.
With "Look Who's Talking" breaking $100 million, Daenerys Entertainment's contract with Warner Brothers, which was signed in exchange for the rights to "Wonder Woman" and "The Bourne Identity," was fulfilled.
Logically, a North American box office success surpassing $170 million would inevitably lead to a sequel.
According to the contract signed, Warner Brothers did not have the rights to participate in the production of the sequel to "Look Who's Talking," which would be entirely under Daenerys Entertainment's control.
Amy was very keen on producing a sequel to "Look Who's Talking," but Simon was not as enthusiastic.
It was difficult to innovate with a comedy centered around talking babies, and the box office performance of the sequels in Simon's memory saw a steep decline. Simon didn't believe this time would be any different.
Moreover, having starred in two billion-dollar hits within a year, Mel Gibson's salary had risen significantly. For the discussion of "Lethal Weapon 3" with Warner, Gibson's asking price was a base salary of $8 million plus 20% of the net profits.
With "Look Who's Talking" expected to outperform "Lethal Weapon 3," a sequel would only see Gibson's salary demands increase.
Although a sequel to "Look Who's Talking" would likely still be profitable, taking up a prime slot in next year's schedule, especially when there are better options available, was a potential time cost Simon was unwilling to bear.
Therefore, without a standout idea surpassing the original, Simon was not ready to approve the production of a sequel to "Look Who's Talking."
Aside from "Look Who's Talking," "Scream 2" saw a 21% drop in its weekly box office, earning $5.11 million, with a cumulative box office of $98.17 million, expected to break $100 million next week. However, with weekly earnings expected to fall below $5 million under the pressure of heavyweights like "Batman," the difficulty for this teen horror film to surpass $110 million in North America was significant.
"Gucci Marks," in its third week, maintained a very respectable 19% drop in box office, earning $6.39 million, with a three-week cumulative of $23.86 million.
Gucci had invested all expected profits into the film's promotion, but with Daenerys Entertainment's contributions, breaking $20 million in box office meant the company was already turning a profit.
Encouraged by the success of "Gucci Marks," other luxury brands and Hollywood studios began to explore partnerships, hoping to replicate the success in both brand marketing and box office. Daenerys Entertainment also officially signed with Madonna, announcing the project for her global tour documentary next year.
Lastly, "Driving Miss Daisy," in its first week, achieved over $23,000 per screen across 32 screens, with a first-week box office of $750,000.
This film, adapted from a famous play addressing racial issues, had a production budget of only $7 million. Its small-scale premiere earning $750,000 in box office was very promising.
Following the release of the previous week's box office data, the nominations for the new American Film and Television Golden Globe Awards were announced on December 16.
Daenerys Entertainment's "My Left Foot" and "Driving Miss Daisy," produced by Highgate Pictures, accumulated 5 important nominations.
"My Left Foot" received nominations for Best Actor in a Drama and Best Supporting Actress. "Driving Miss Daisy" was nominated for Best Picture in Musical or Comedy, Best Actor in Musical or Comedy, and Best Actress in Musical or Comedy.
"Sixth Sense," a summer blockbuster, was also worthy of Golden Globe nominations. If submitted, nominations for Best Picture in Drama, Best Screenplay, Best Actor in Drama, and Best Supporting Actor were very likely.
However, due to controversies over the screenplay and to make way for "My Left Foot" and "Driving Miss Daisy," Daenerys Entertainment decided not to nominate the film.
"Sixth Sense" concluded its run on December 7, after 23 weeks in North American theaters, with a total box office of $295.38 million, narrowly missing the $300 million mark.
With weekly earnings in the final weeks only in the two to three hundred thousand range, achieving a box office rebound to surpass $300 million was no longer possible without directly purchasing tickets. Daenerys Entertainment chose not to pursue this title further.
With over $290 million in box office, it already ranked as this year's box office champion. Most media agreed it was unlikely any film would surpass "Sixth Sense" by the end of the year.
Regardless of breaking $300 million, Daenerys Entertainment had already made a substantial profit, and there was no less respect for the film for not crossing the $300 million threshold.
In New York, within an apartment on Fifth Avenue in the Upper East Side, it was December 18, Monday.
Simon and Janet arrived last Friday, mainly to record an episode of "The Tonight Show with John Carson" for "Batman" promotion.
Due to social obligations, they did not return to the West Coast over the weekend.
Last night, they attended a party for David Dinkins, the newly elected mayor of New York, who defeated Rudy Giuliani in the November mayoral election.
The election coincided with a minor stock market crash in October, and Dinkins's campaign capitalized on a scandal involving Giuliani's inappropriate comments during the investigation of Michael Milken, securing a decisive victory.
Westeros Company provided significant support for Dinkins's campaign, though Simon had no explicit political agenda.
Or, if there was one,
it was to announce Simon Westeros's involvement in the political game to North America, indicating his political stance.
Simon rose early as usual, despite the recent snow in New York making Central Park a snowy landscape and the weather quite cold.
After breakfast, Simon bid farewell to Janet and headed to the airport alone to return to the West Coast.
During this time, Janet continued to manage Cersei Capital. Compared to the constant changes in the Japanese stock futures market, the positions aimed at the North American bond market were long-term bearish contracts, requiring less daily monitoring. Cersei Capital's sub-fund teams were granted a degree of autonomy, allowing Janet to travel with Simon.
The junk bond market crisis in the US, triggered by the minor crash in October, continued in recent months. With plans to liquidate all positions and exit the North American junk bond market before the New Year, Janet decided to stay in New York to personally oversee the final stages of the operation.
Planning to fly to Australia for Christmas after the "Batman" premiere on December 20, Simon was also very busy in the following days.
Upon returning to Los Angeles, due to the time difference, it was still morning on the West Coast, just starting work hours.
Jennifer and Simon returned together, and on the plane, the female assistant informed Simon that the Australian Qintex Group had officially signed an acquisition agreement with MGM today.
Before this, Qintex Group's detailed plan to acquire MGM had been published in the media.
In recent years, although Kirk Kerkorian was recognized as MGM's owner, the film company, one of the Big Seven, was actually a publicly traded company. Kerkorian only owned 70% of MGM's shares.
Kerkorian's "capital operations" around MGM were also conducted on these 70% of the shares.
This time, Qintex Group would acquire the 70% stake in MGM-UA from Kerkorian for $1 billion in cash, becoming the absolute controlling shareholder of this historic film company. This transaction also meant that Qintex Group would take on over $700 million in various debts of MGM.
Qintex Group's financial stability was precarious, a fact that the omniscient North American media had fully uncovered recently. The general opinion was pessimistic about this transaction, and some speculated about Simon's involvement, given his close ties to Australian capital. Many believed that Daenerys Entertainment might help MGM recover.
This acquisition involved not only Qintex Group but also other Australian capitals eager to enter Hollywood's media sector. Otherwise, Qintex Group alone would not have been able to complete this transaction.
Although Simon accepted an invitation from Qintex Group's Chairman, Christopher Skase, to attend the acquisition luncheon for MGM, he had no intention of assisting MGM.
At least, not until he gained control of the company.
Returning to the West Coast, Simon headed straight to Daenerys Entertainment's headquarters in Santa Monica upon leaving Los Angeles International Airport.
A meeting awaited him there.
Last Wednesday, Daenerys Entertainment officially completed the acquisition of a stake in EA, ultimately securing 35% of the PC game production and distribution company's shares from its original major shareholders for $50 million, becoming EA's largest shareholder.
Compared to the initial acquisition budget of $350 million, securing 35% of EA for $50 million, valuing the company at only $140 million, was much lower than EA's market value of around $170 million before the transaction.
EA's shareholders were interested in Daenerys Entertainment's content development capabilities.
After Daenerys Entertainment's investment, assisting EA in developing a hit game like "Teenage Mutant Ninja Turtles" would make the sale of 35% of the company for $50 million profitable. Moreover, with the resurgence of console games, EA was planning to enter the console game market but was hesitant due to Nintendo's stringent royalty system.
EA was considering partnering with Sega to port its games to Sega's console platform, a questionable decision given Sega's less than 10% market share in North America and Japan.
Now, following the preferential agreement reached between Blizzard Studios and Nintendo, and discussions specifically on this matter, EA's games could enjoy the same royalty benefits as Blizzard Studios after Daenerys Entertainment's investment. This was why EA's shareholders quickly reached a stock sale agreement with Daenerys Entertainment.
After the transaction was announced last Wednesday, EA's stock price surged over the next three trading days, with a cumulative increase of over 70%, pushing its market value to $290 million by close on Friday. Thus, Daenerys Entertainment's $50 million investment in EA realized over 100% profit on paper in just a few days.
Obviously, EA's original shareholders also profited handsomely from the stock price surge.
Today's meeting aimed to continue stimulating EA's stock price with some positive news.
During negotiations with EA, Simon had already instructed Nancy to acquire rights suitable for game adaptations. This meeting was to discuss and subsequently announce exactly that.
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