Chương 263: Chapter 263: Carl Icahn
Charles stepped out of the Goldman Sachs headquarters, followed by his bodyguards and assistants. He took one last look at the building before getting into the car.
"Was that old guy Carl Icahn just now?"
Charles asked Dona Williams beside him.
"Yes, Carl Icahn," Dona Williams replied, holding a billion-dollar loan contract led by Goldman Sachs, using Capet Entertainment as collateral.
Priority debt to equity conversion: If Charles couldn't repay the funds when due, the equity in Capet Entertainment would be converted first.
"He's your financial world's legendary hostile takeover expert, the 'Wolf of Wall Street'!" Charles remarked casually. Carl Icahn mainly targeted high-debt public companies for leveraged buyouts with minimal capital, controlled the board for splitting and restructuring operations, raised stock prices, and cashed out!
No care for the company's business strategy and future, just there to bleed it dry.
"Carl Icahn is highly skilled and his judgment is very precise. Any prey he targets usually gets a bite taken out of it," explained Dona Williams. After all, this was the real 'Wolf of Wall Street.'
Not like that small fry Jordan Belfort.
"Capet Entertainment isn't even publicly traded. If such a big fish wants to make a move, wait until we go public," Charles shook his head. No matter how powerful Carl Icahn was, he needed the right avenues.
Meanwhile, at the top-floor office in Goldman Sachs headquarters, two elderly men stood by the window, watching Charles and his entourage leave.
They were Lloyd Blankfein, Chairman of Goldman Sachs, and Carl Icahn, the 'Wolf of Wall Street.'
"Carl, Capet Entertainment is already $1 billion in debt, and now we're lending another billion. Aren't you worried?" Lloyd Blankfein laughed. Originally, it was a three-way deal between Goldman Sachs, Merrill Lynch, and Blackstone, but then Carl Icahn jumped in to support the loan.
"Hahaha, and you think Capet Entertainment isn't worth $1.5 billion? The global box office for The Da Vinci Code isn't astonishing?" Carl Icahn withdrew his gaze. This was Wall Street, New York, not Hollywood, Los Angeles.
"You've been involved in American Online, Yahoo, early Marvel Comics, and now you're a shareholder of Lionsgate. Weren't you planning to acquire some of MGM's debt? Why are you eyeing Capet Entertainment now?" Lloyd Blankfein was puzzled. The man in front of him was like a fly that would bite every crack in the egg.
But Capet Entertainment had strong cash flow and a robust growth momentum, leaving no room for a strike.
"I heard that Charles Capet has raised no less than $1 billion, planning to make a big splash in the stock market," Carl Icahn smiled.
"You've seen it too. The U.S. real estate market is shrouded in mist right now. He might shine brilliantly in Hollywood, but this is Wall Street."
"I heard Richard Fuld has increased Lehman Brothers' underwriting of subprime loans?" Carl Icahn asked with a smile. Richard Fuld was the chairman and CEO of Lehman Brothers, nicknamed 'The Wall Street Bull.'
"Last year alone, Lehman Brothers underwrote subprime loans exceeding $100 billion, more than 11% of the entire market. Next was the Royal Bank of Scotland at 10%. Our several major investment banks were below 8%," Lloyd Blankfein shook his head with disdain.
"Lehman Brothers increased their volume, really thinking they can mitigate risks at any time? Richard Fuld is too arrogant!"
"The 'Wall Street Bull' won't charge forward relentlessly? Hahaha," Carl Icahn laughed.
Lloyd Blankfein's level in Hollywood wouldn't fail to see the problems in the U.S. real estate market.
It was like a game of hot potato; you never know when the bomb would explode, so it's wise to make sure you're not the last one holding it.
Charles Capet told his mother he'd only invest seven or eight hundred million dollars, but he managed to secure $1.2 billion in cash loans from various Wall Street bank institutions.
Lily Ying, overseeing operations, distributed the $1.2 billion across more than thirty companies controlled by Capet Funds both domestically and internationally.
With a 10x leverage trading principle, the goal was to short Freddie Mac and Fannie Mae, two real estate giants each valued at nearly $500 billion, easily absorbing Capet Funds' capital.
$1.2 billion at 10x leverage equals $12 billion in betting capital. Although the accounts were scattered, it was still a considerable capital scale.
Freddie Mac's stock price was now at its peak, hit $70 in October last year, though in June it was still around $55.
"Boss, Freddie Mac broke the $70 mark in October, are we really starting now?" Lily Ying was excited, her face flushed and blood boiling.
"For over a month now, Freddie Mac and Fannie Mae's stock prices have fluctuated around $70, never moving above $2. It's at its peak," Charles looked at Lily Ying.
"This year, you need to invest all our capital. U.S. capital, European and Asian international capital, are all your targets!"
10x leverage, if Freddie Mac and Fannie Mae's stock increased by more than 10% after any medication, the short accounts would be forcibly closed out. But is that likely?
Lily Ying nodded. To hedge, you needed institutions to bet against you. Wall Street had global investment institutions, making it ideal.
"Okay, boss," Lily Ying knew the boss's aim was to make money discreetly, with more foreign exchange in Capet Funds being a bonus.
"Very well. Next year, we'll reap our harvest, and I'll support you in starting your hedge fund," Charles smiled. Talent was great, young talent was even better, full of drive and big-heartedness.
"Alright, I'm off to attend the New York premiere of 300 now," Charles straightened his suit and left the office.
Lily Ying sat down, her fair face unable to hide her excitement. Opportunities like this in life were not many.
*****
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