Chapter 256： Negotiations between you and me
In the end, William Chen decided to buy 8 million preferred shares of Netflix at a price of $25 and spent a total of $200 million to support their content production plan.
actually. Hastings prefers to raise funds through financing, but in the current market, the valuation of Netflix will not satisfy him, so if he can raise funds by issuing preferred shares, it is the best at this time. Good way too.
But for this financing, William Chen did not support Netflix so unconditionally, and stipulated two terms in the signed agreement to purchase preferred shares:
One is that when the next financing is carried out, William Chen has the right to convert the preferred stock he currently holds into common stock. If all the preferred shares currently held by William Chen are converted into common shares, then his shareholding in Netflix will become 44.22%, nearly half of the shares.
The second is that William Chen should have priority in the next financing of Netflix, which means that when Netflix raises next financing, William Chen can have priority to invest in the purchase of additional shares at the same price.
Through these conditions, William Chen also ensured that he has the largest shareholding in Netflix, preventing Hastings from diluting his shares by introducing major shareholders.
After all, in the previous investment behavior, William Chen had reached an agreement with Hastings, and the voting rights of the shares he held were not allowed to use the veto in the opinions put forward within the scope of the other party's operation of the company, but only reserved. The two rights of consent and abstention.
Under this premise, Hastings will not easily limit his interests in the company by diluting William Chen's shares unless it is a last resort, otherwise this behavior will definitely be criticized by many investors.
But nothing is absolutely necessary to take certain measures, and it is very necessary to avoid it.
In addition to Netflix, another thing William Chen is currently facing is the acquisition of PayPal.
After Nielsen and his team started to contact eBay and proposed the acquisition of PayPal, eBay has always had a rather ambiguous attitude. There was no clear rejection or happy agreement. It was only delayed because it needed the consideration of the board of directors.
eBay's situation is not very good now. After the subprime mortgage crisis affected various industries, eBay's turnover has been declining.
Not long ago, eBay announced a global layoff of 10% in response to the crisis.
Therefore, they analyzed that eBay is not unwilling to sell PayPal, but they can also see the development of PayPal, so they will be entangled.
Now, after a period of deliberation, eBay has finally responded to the Meta Group, agreeing to begin negotiations on its acquisition of PayPal.
Initially, eBay's bid was to sell PayPal for $15 billion, which was ruthlessly rejected by the Meta Group.
What a joke, now that the market value of eBay is only about $23.5 billion, you dare to ask PayPal for $15 billion? Then I might as well just buy the entire eBay, but it's less than $9 billion.
Of course, if you say that, if you want William Chen to buy eBay, he will definitely refuse. Even though eBay has been brilliant, he has to admit that the current eBay is indeed very stretched. Not only has it been surpassed by the latecomer Amazon, but also The distance between the two is visibly widened.
For this kind of company that is destined to have no great future, Chen William has no interest at all.
However, even knowing that PayPal has great potential in the future, it is completely impossible for him to acquire it at a price of 15 billion. I am afraid that eBay themselves do not believe that they can sell PayPal at this price. They just want to try to see if they can achieve 100 times the return on investment.
After all, they bought PayPal for only $1.5 billion, and they haven't paid cash yet, it's all stock.
Therefore, they directly persuaded the other party to dispel this unrealistic illusion. The Meta Group's asking price was $6 billion in cash. 4 times the investment rate of return, now you can be satisfied, you know, now is the economic crisis.
So the bombshell became eBay. They said that at this price, there is no need to continue to negotiate. eBay would not want to waste time on this kind of insincere bid.
Well, isn't it time for you to start with an unrealistically high price?
It's just that these statements are just statements, and the discussion should continue.
Chen William would not patronize and talk to eBay. Just when they were coming and going, Meta Technology completed two acquisitions, acquiring Zong, a mobile payment provider, for $150 million.
Currently Zong works with more than 200 mobile network operators around the world, providing local payment services in 21 languages in more than 40 countries.
Then they acquired Venmo, a P2P payment software that was launched soon, for $20 million. This is a mobile phone software for small-value transfers between individuals, but does not support large-value transfers. This software emphasizes social attributes, so it does not provide business-to-business Business or business-to-person business.
For the acquisition of these two companies, it can be said to put pressure on eBay. You can not actively sell PayPal to me, but I can make my own payments through the acquisition, and PayPal will also be ready for competition.
This alone, William Chen felt that it was not enough, so the news of Meta Group's intention to acquire Square began to be reported. If Zong and Venmo are still small companies for PayPal, then Square is a big threat.
eBay really started to get nervous, and the negotiations with Meta Group about PayPal also began to enter a substantive stage.
The content of the current negotiation, in addition to a price that both parties can accept, is the follow-up cooperation between eBay and PayPal after the Meta Group acquired PayPal.
At present, there is an agreement between eBay and PayPal. When shopping on eBay, you can only choose PayPal as a payment method. This is also one of the main reasons for PayPal's rapid development after eBay's acquisition.
But if eBay sells PayPal, they don't need to recommend PayPal as the only payment method. After all, people who shop on eBay may not all sign up for PayPal. Even if all eBay users sign up for PayPal because of the uniqueness of the past, many of their new and old users will have more accustomed payment methods.
Therefore, if it is only for the sake of improving the user experience, it will definitely be beneficial to eBay to open up more payment methods-since PayPal no longer belongs to them, there is no need to give the other party such good conditions.
eBay proposed that if the current payment method is continued, then eBay needs to retain at least a certain amount of PayPal shares, and they will not consider changing the existing payment situation if they do not completely sell the company and have interests bound.
But William Chen knows eBay's future development, and that's it. He definitely doesn't want to leave eBay's shares, so in this regard, it is also one of the focuses of the negotiation.
Chen William did not participate in the specific negotiations. He just drew a line for the acquisition of PayPal, which is no more than 10 billion US dollars.
He is currently negotiating a lot of projects, but Meta Investment Company’s account is only about $8.8 billion, and he is still burdened with more than $10 billion in financing from Goldman Sachs. In addition to the current status of Goldman Sachs, it is not too much. It can be said that even if the Federal Reserve releases a lot of water, it will take a certain amount of time for the American financial system to restore part of its hematopoietic capacity.
Therefore, William Chen will not have more funds for the acquisition has begun to consider closing his long position on the gold futures contract, which has invested 2 billion US dollars.
At present, the international gold price has risen to more than 1,500 US dollars per ounce. Martin Stephenson couldn't help but ask him when he was going to close the remaining gold futures after the completion of the Kettering Fund's gold futures.
After all, 10 times leverage is still very disturbing. A 1% rise or fall is equivalent to a 10% profit and loss.
"You've been making a lot of moves lately, William. I heard that you've been in talks with eBay to acquire PayPal for a long time?"
Bill Gates invited Chen William to play golf together today. His Gates Foundation has also invested $500 million in Chen William's Tianshu Fund. The two have met a lot recently.
After he hit the ball with his swing, he looked into the distance and said to Chen Weiliang.
"Mr. Gates, why do I always feel that you are paying attention to my every move?" William shook his head and said.
"Haha, that can only blame you for making such big news every time." Bill Gates walked forward with William Chen and said, "I focus on emerging companies that can subvert the technology industry. It can only be said that your Meta technology is indeed full of potential."
American Road to Fame https://
actually. Hastings prefers to raise funds through financing, but in the current market, the valuation of Netflix will not satisfy him, so if he can raise funds by issuing preferred shares, it is the best at this time. Good way too.
But for this financing, William Chen did not support Netflix so unconditionally, and stipulated two terms in the signed agreement to purchase preferred shares:
One is that when the next financing is carried out, William Chen has the right to convert the preferred stock he currently holds into common stock. If all the preferred shares currently held by William Chen are converted into common shares, then his shareholding in Netflix will become 44.22%, nearly half of the shares.
The second is that William Chen should have priority in the next financing of Netflix, which means that when Netflix raises next financing, William Chen can have priority to invest in the purchase of additional shares at the same price.
Through these conditions, William Chen also ensured that he has the largest shareholding in Netflix, preventing Hastings from diluting his shares by introducing major shareholders.
After all, in the previous investment behavior, William Chen had reached an agreement with Hastings, and the voting rights of the shares he held were not allowed to use the veto in the opinions put forward within the scope of the other party's operation of the company, but only reserved. The two rights of consent and abstention.
Under this premise, Hastings will not easily limit his interests in the company by diluting William Chen's shares unless it is a last resort, otherwise this behavior will definitely be criticized by many investors.
But nothing is absolutely necessary to take certain measures, and it is very necessary to avoid it.
In addition to Netflix, another thing William Chen is currently facing is the acquisition of PayPal.
After Nielsen and his team started to contact eBay and proposed the acquisition of PayPal, eBay has always had a rather ambiguous attitude. There was no clear rejection or happy agreement. It was only delayed because it needed the consideration of the board of directors.
eBay's situation is not very good now. After the subprime mortgage crisis affected various industries, eBay's turnover has been declining.
Not long ago, eBay announced a global layoff of 10% in response to the crisis.
Therefore, they analyzed that eBay is not unwilling to sell PayPal, but they can also see the development of PayPal, so they will be entangled.
Now, after a period of deliberation, eBay has finally responded to the Meta Group, agreeing to begin negotiations on its acquisition of PayPal.
Initially, eBay's bid was to sell PayPal for $15 billion, which was ruthlessly rejected by the Meta Group.
What a joke, now that the market value of eBay is only about $23.5 billion, you dare to ask PayPal for $15 billion? Then I might as well just buy the entire eBay, but it's less than $9 billion.
Of course, if you say that, if you want William Chen to buy eBay, he will definitely refuse. Even though eBay has been brilliant, he has to admit that the current eBay is indeed very stretched. Not only has it been surpassed by the latecomer Amazon, but also The distance between the two is visibly widened.
For this kind of company that is destined to have no great future, Chen William has no interest at all.
However, even knowing that PayPal has great potential in the future, it is completely impossible for him to acquire it at a price of 15 billion. I am afraid that eBay themselves do not believe that they can sell PayPal at this price. They just want to try to see if they can achieve 100 times the return on investment.
After all, they bought PayPal for only $1.5 billion, and they haven't paid cash yet, it's all stock.
Therefore, they directly persuaded the other party to dispel this unrealistic illusion. The Meta Group's asking price was $6 billion in cash. 4 times the investment rate of return, now you can be satisfied, you know, now is the economic crisis.
So the bombshell became eBay. They said that at this price, there is no need to continue to negotiate. eBay would not want to waste time on this kind of insincere bid.
Well, isn't it time for you to start with an unrealistically high price?
It's just that these statements are just statements, and the discussion should continue.
Chen William would not patronize and talk to eBay. Just when they were coming and going, Meta Technology completed two acquisitions, acquiring Zong, a mobile payment provider, for $150 million.
Currently Zong works with more than 200 mobile network operators around the world, providing local payment services in 21 languages in more than 40 countries.
Then they acquired Venmo, a P2P payment software that was launched soon, for $20 million. This is a mobile phone software for small-value transfers between individuals, but does not support large-value transfers. This software emphasizes social attributes, so it does not provide business-to-business Business or business-to-person business.
For the acquisition of these two companies, it can be said to put pressure on eBay. You can not actively sell PayPal to me, but I can make my own payments through the acquisition, and PayPal will also be ready for competition.
This alone, William Chen felt that it was not enough, so the news of Meta Group's intention to acquire Square began to be reported. If Zong and Venmo are still small companies for PayPal, then Square is a big threat.
eBay really started to get nervous, and the negotiations with Meta Group about PayPal also began to enter a substantive stage.
The content of the current negotiation, in addition to a price that both parties can accept, is the follow-up cooperation between eBay and PayPal after the Meta Group acquired PayPal.
At present, there is an agreement between eBay and PayPal. When shopping on eBay, you can only choose PayPal as a payment method. This is also one of the main reasons for PayPal's rapid development after eBay's acquisition.
But if eBay sells PayPal, they don't need to recommend PayPal as the only payment method. After all, people who shop on eBay may not all sign up for PayPal. Even if all eBay users sign up for PayPal because of the uniqueness of the past, many of their new and old users will have more accustomed payment methods.
Therefore, if it is only for the sake of improving the user experience, it will definitely be beneficial to eBay to open up more payment methods-since PayPal no longer belongs to them, there is no need to give the other party such good conditions.
eBay proposed that if the current payment method is continued, then eBay needs to retain at least a certain amount of PayPal shares, and they will not consider changing the existing payment situation if they do not completely sell the company and have interests bound.
But William Chen knows eBay's future development, and that's it. He definitely doesn't want to leave eBay's shares, so in this regard, it is also one of the focuses of the negotiation.
Chen William did not participate in the specific negotiations. He just drew a line for the acquisition of PayPal, which is no more than 10 billion US dollars.
He is currently negotiating a lot of projects, but Meta Investment Company’s account is only about $8.8 billion, and he is still burdened with more than $10 billion in financing from Goldman Sachs. In addition to the current status of Goldman Sachs, it is not too much. It can be said that even if the Federal Reserve releases a lot of water, it will take a certain amount of time for the American financial system to restore part of its hematopoietic capacity.
Therefore, William Chen will not have more funds for the acquisition has begun to consider closing his long position on the gold futures contract, which has invested 2 billion US dollars.
At present, the international gold price has risen to more than 1,500 US dollars per ounce. Martin Stephenson couldn't help but ask him when he was going to close the remaining gold futures after the completion of the Kettering Fund's gold futures.
After all, 10 times leverage is still very disturbing. A 1% rise or fall is equivalent to a 10% profit and loss.
"You've been making a lot of moves lately, William. I heard that you've been in talks with eBay to acquire PayPal for a long time?"
Bill Gates invited Chen William to play golf together today. His Gates Foundation has also invested $500 million in Chen William's Tianshu Fund. The two have met a lot recently.
After he hit the ball with his swing, he looked into the distance and said to Chen Weiliang.
"Mr. Gates, why do I always feel that you are paying attention to my every move?" William shook his head and said.
"Haha, that can only blame you for making such big news every time." Bill Gates walked forward with William Chen and said, "I focus on emerging companies that can subvert the technology industry. It can only be said that your Meta technology is indeed full of potential."
American Road to Fame https://
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