"Sure enough, it''s the lion who opens his mouth."


    Arthur frowned, said with a sneer, and then reached for his men to sit down.


    After sitting down, the person in charge of the team negotiation said helplessly: "it''s expected that they have such a big appetite. Behind the confidence that they dare to ask for this price, they are a smart abacus. They have recovered their equity investment and can make another profit by listing AMC.


    Moreover, in fiscal year 2009, despite the economic crisis, AMC performed very well, with a net profit of $79.91 million. Private equity shareholders are confident that the 2010 earnings report will be more eye-catching, and IPO should be a natural result.


    These factors add up to make them feel confident. However, they have also expressed enough welcome for our appearance, so that they can sit down and talk about everything... In fact, they also know that if the IPO is not successful, it is not easy to find a good buyer. The buyer should not only have enough money, but also have enough business level. Only in this way, can repayment be safer.


    Therefore, in their eyes, boss, you are one of the good buyers. Of course, if AMC can go public, it would be great for them. After all, the stock market returns are much higher than the bond market, and their calculation is that AMC can go on the market if it can, but it can''t sell if it can. It can walk on two legs.


    However, the key is the bond issue. AMC cinema has been fully overdrawn and cashed out by these guys for the next few years. " The person in charge of the negotiation took out a file bag from his bag, opened it, took out a pile of documents from it, handed it to Arthur, but shook his head and said.


    "Bonds..." Arthur make complaints about it. He looked at the paper and looked at it. "I am a bad ass!"


    If it is in a casino, then the risk assessment and control is the key to ensure that you have the capital to bet on. Similar to casinos, bonds also face the same problem. This is a game that can''t make any mistakes. It is also one of the biggest problems Arthur has to face in AMC M & A transactions.


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


    If Arthur wants to buy AMC, he must face these bond investors and try to persuade them so that he can restructure these short-term or nearly due debts and extend the repayment date.


    You can imagine how hard it was to convince these people. This involves the change of control right of the bond, which belongs to the major default clause in the bond. The confidence of creditors becomes the key.


    And officially entered the AMC. Strictly speaking, this is only a leveraged asset restructuring. After the restructuring, the debt increases and the equity structure reshuffles. It belongs to the friendly and cooperative leveraged buyout, not a hostile acquisition. Next, the test for Arthur''s side is to fight directly with the Wall Street giants as the owner of AMC.


    Here we can not but mention the Qian rule of leveraged M & A on Wall Street. M & A is the magic weapon of Wall Street''s profit, because no matter whether it is successful or not, Wall Street can earn handling fees, LBO companies will charge management fees, investment banks will charge consulting fees, securities companies will charge high-yield bond issuance fees, etc.


    Investment banks, private equity funds and securities companies, among them, you have me and I have you. Their relationships are complicated, and many of them have maintained friendship for decades. As a result, Wall Street''s M & a business can be seen as an endless game between old friends.


    Of course, they are not a group of vampires, there are also fierce disputes and interests between them, Arthur can pull a group, fight a group, and then disintegrate from the inside, but these are later words.


    Now, what he has to face is whether he can accept and tolerate the unscrupulous lion''s big mouth like price blackmail and bite his teeth to buy AMC cinema line.


    "Boss, AMC''s private equity fund shareholders are also facing two crises. One is that 2012 is the exit period of the fund. Second, there is a huge amount of maturing debt that needs to be refinanced. No matter from which angle analysis, AMC''s private equity fund shareholders are facing very difficult problems.


    If they don''t want to take out their own money to fill this hole, then either IPO will succeed or they can fill in their own money. Ha ha, it''s OK to let them put money in their pocket, but it''s basically impossible for them to take money out.


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


    Hearing the report from his subordinates, Arthur nodded. You know, in LBO, private equity funds only use a small amount of their own funds. Most of the funds come from debt financing, including bond markets and banks, and a small amount of mezzanine debt.


    Once the repayment period is reached, it is definitely the biggest problem that the acquired enterprises and purchasers need to face. If the capital chain breaks down, it means that the game is broken, and there is only one way to go: applying for bankruptcy protection and restructuring debts."Although shameless, but the five private equity companies holding the AMC listing card, can calmly carry out debt restructuring." After the acquisition of AMC''s shares, he continued to smile at us, not the focus of the debt.


    The equity price and debt of AMC is a package deal. When AMC''s debt problem is solved, the equity transaction price can be easily discussed... Whether it''s equity or debt, I have only two requirements. Before the completion of the acquisition of AMC, one is to pay as little cash as possible, and I also hope that the cash outflow of AMC will be as small as possible. Secondly, the shareholders of private equity funds should pay back the short-term financing of AMC as much as possible, and have enough ability to cover the long-term financing. "


    "Well, it is."


    Arthur pondered for a while, frowning and smiling, he said to his negotiator, "when will the negotiation officially begin?"


    "Tomorrow morning at 10 o''clock."


    "I''ll be with you." Arthur decided.


    "OK, boss. However, during the negotiation, I hope you don''t make any easy decisions on the spot..."


    "Oh, don''t worry. I just want them to understand my attitude and will not interfere with your negotiation." For his own staff some worry like reminder, Arthur did not care, this measure, he still has.


    On the morning of the next day, Arthur, dressed in a high set black suit, looked very tall, smart and capable. With a group of his own, in the conference room of Tianpeng holding company, which is jointly established by the five holding private equity funds of AMC cinema, he met the directors of Apollo investment fund, Mg Datong investment fund, Bain Capital, Carlyle and spectrum investment fund.


    The two sides first shook hands and exchanged greetings, and then they separated the two sides of the conference table and sat down in a completely different way. Arthur sat in the position of deputy, and the person in charge of the negotiation took the main position. After all, Arthur was a layman in business negotiations, so he would not fiddle around.


    But when Arthur saw the five funds in charge who were arranged in front of each other and sat in the middle, his eyes were dark. Sure enough, these five funds were not vegetarians. Everyone was worried about their own interests and didn''t believe anyone.


    As everyone knows, one monk carries water to eat, five monks have no water to eat.


    All the five responsible persons can speak, express their positions and attitudes, and make demands, but none of them can count. Tut, this is the most fatal.


    "First of all, I would like to state that in this acquisition, I want to take 100% equity of amc100. If this condition is not met, the whole acquisition transaction will automatically stop. To tell you the truth, there are not many big buyers like me who can take a fancy to the cinema company which has already belonged to the declining industry. I also believe that once my acquisition is cancelled, the news will not only scare off other buyers, but also destroy your desire to get huge amounts of cash in the short term. " Seeing the clue, Arthur, who originally wanted to keep a deep look at the negotiation atmosphere, decided to throw a bomb first to stimulate the five people with different thoughts on the opposite side!


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