Capítulo 162: Chapter 162: Missed Opportunity
[Chapter 162: Missed Opportunity]
After seriously reviewing the information on two companies, Eric realized that perhaps due to having been established for over a decade, New Line had far more power than Miramax. The simplest evidence was in their distribution capabilities; as a second-tier film company, New Line could open nearly 1,500 screens for a movie, whereas Miramax was still in its infancy, managing to muster only four or five hundred screens at most for its releases. Furthermore, New Line had already begun its independent production business when Miramax was founded and now owned very profitable series rights, while Miramax was still in the phase of buying and releasing films worldwide.
Reading this made Eric lightly tap the table, suddenly remembering something he had missed regarding Steven Soderbergh's film, which had made him the youngest Palme d'Or winner at the Cannes Film Festival a few months prior.
Eric had even reminded himself at the time to secure the North American rights to this film, but he had become so wrapped up in the hectic filming schedule that he had inadvertently forgotten.
If history had not deviated, that film would certainly have been picked up by the Weinstein brothers. In Eric's memory, Miramax had risen to prominence thanks to this film, making a nice profit and gaining enough capital to enter the independent production realm, slowly forging its own path to success.
By July, Eric only knew that the film had won the Palm d'Or at the Cannes Film Festival in May, but he had yet to see any news in newspapers or magazines about its North American release.
If Miramax had indeed secured the distribution rights to this film, it would be best for Eric to reach an acquisition agreement before the movie debuted. Otherwise, once it garnered a good box office, even if the Weinstein brothers agreed to the acquisition afterward, Eric would definitely have to pay a higher price. The rules of the industry were such that one film could significantly increase a company's market value, much like how Pixar, which had originally been worth $50 million, saw its value soar twenty times due to its success with Toy Story.
In Eric's vision, securing both companies simultaneously would be ideal, allowing them to develop along both commercial and art film lines. With the classic Oscar-winning films he recalled, even if Miramax returned to focusing on art films, it surely wouldn't earn less than a company committed to commercial filmmaking.
According to the data, New Line's estimated market value was around $150 million, being a well-established company with a substantial film library and valuable series rights. These series had been producing low-budget horror films annually since 1984, consistently turning a profit, and while the box office returns were not extremely high, they proved to be enduring.
Though Miramax still found itself in a third-tier position, its estimated market value was around $20 million, thanks to the Weinstein brothers actively acquiring plenty of film resources over the years. Eric understood well that Miramax's true value didn't lie in its label or the films in its library, but rather in the Weinstein brothers themselves. In his past life, once the brothers abandoned Miramax in 2005, the company quickly fell from grace, eventually being sold off to Disney for a bargain.
Now, Eric knew that while he had just over $100 million coming in and could take out loans again, trying to acquire both companies was more than just a matter of simple cash -- it would inevitably involve negotiations over equity swaps. He believed that with Robert Shaye and the Weinstein brothers' sharp minds, even if he managed to secure enough funding through loans with the intention of a full acquisition, those three wouldn't agree. There was more value in exchanging equity for a potentially thriving film company than a straightforward buyout.
As he pondered these matters with a furrowed brow, Jeffrey knocked and walked in.
...
"News from Venice just came in; the film successfully entered the main competition. Also, Jonathan Demme revised the movie again per your suggestions. Eric, do you want to take another look?"
"Yeah, I'll head to the screening room now," Eric nodded, temporarily setting aside the thought of acquiring both companies as he followed Jeffrey out of the office.
"What were you just thinking so deeply about?" Jeffrey asked casually as they walked side by side.
"New Line and Miramax's information, you know how it is," Eric replied. "I want to take both companies at once, but I don't want to give away too much equity."
Jeffrey fell silent; he understood that as the company expanded, he might not have the capability to support the entire operation. Just previously, he had only been responsible for a few films that Eric produced and financed, and he didn't even have to worry about distribution. However, after acquiring new companies, Firefly would have to venture into distribution, an area where Jeffrey had no prior experience, and he would certainly have to relinquish the CEO position.
Yet after a brief moment of uncertainty, Jeffrey soon felt at ease. As long as Firefly remained Firefly, he had always aimed to build it into a large film company. Now that there was momentum, what was his position compared to that ambition? Ever since his earlier stubborn choices led to the original Firefly's bankruptcy due to his own directorial efforts impacting his wife, Jeffrey had become more self-aware. Although he would occasionally grumble and offer small suggestions regarding Eric's film production, he never interfered with content creation because he knew he didn't have that talent.
Thinking through this, Jeffrey clapped Eric on the shoulder. "If it doesn't work out, take your time. I've looked over the materials for both companies and, honestly, I lean more towards New Line. Even if it means swapping some shares, it'd be worth it. Miramax feels too small; I can't see what you find appealing about that company."
Eric laughed slightly, "You'll understand in time."
As they spoke, they entered Firefly's screening room, where Jonathan Demme likely pulled another all-nighter, evidenced by the dark circles under his eyes, showcasing how much he valued this film.
*****
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