The situation in the media was tense, but the atmosphere within the Westeros system was not as fearful as the outside world might imagine.
In early March, Daenerys Entertainment Group officially launched an internal employee stock subscription plan. Based on their position and years of service, Daenerys Entertainment employees could purchase shares at 30%, 50%, or 70% of the expected IPO issue price.
Equity rewards for senior management, including Amy Pascal, also began to be realized.
After this stock subscription and reward realization, employees of Daenerys Entertainment would hold a total of about 8% of the company's shares. The planned IPO would issue approximately 12% new shares, leaving Simon still holding about 80% of Daenerys Entertainment Group's shares.
Furthermore, Daenerys Entertainment would adopt a dual-share structure for this IPO. Both the employee subscription and the subsequent IPO would only offer Class A shares, which have one-tenth the voting rights of the Class B shares held by Simon's Westeros Company.
This structure would ensure that even if Simon's holding dropped to 80% after the IPO, he would still maintain over 97% of the voting rights. Even if future expansions reduced the Westeros family's holding below 50%, their absolute control would remain unchanged.
Daenerys Entertainment Group's 1993 financial report was also officially released in mid-March. Ignoring external turmoil, the company published specific data on Egret Portal on March 15 to build momentum for the upcoming IPO.
In the entire year of 1993, Daenerys Entertainment Group's total revenue grew by 35% from $12.7 billion in 1992 to $17.1 billion, with a net profit of $2.27 billion, a year-on-year increase of 219%.
The film business remained the core of Daenerys Entertainment Group, contributing more than half of the profits. The strong performance of the film business drove excellent growth in Daenerys Entertainment's cinema chains, theme parks, and consumer products.
Robert Iger's television business also performed well. Public network reality shows and dramas like "Survivor" and "Seinfeld" consistently topped network ratings. The professional fashion channel Fashion TV, launched last year, had already gone live in multiple countries and successfully acquired all shares of USA basic cable network, further solidifying Daenerys Entertainment's cable TV business.
In addition, Daenerys Entertainment Group's total debt slightly increased from $7.1 billion to $7.9 billion. However, even with an IPO valuation of $40 billion, this debt only represented a 19% debt ratio, far below the industry average.
Despite expectations, Daenerys Entertainment Group's 1993 financial report still exceeded many predictions, especially in terms of profit.
The annual net profit of $2.27 billion was almost equivalent to the combined profits of the other six major Hollywood studios.
Of course, there were doubts. Many professional media and Wall Street analysts believed that Daenerys Entertainment's financial report was specifically tailored for this year's IPO and that such outstanding profits might not be sustainable post-listing.
However, such doubts did not gain much traction. A net profit of $2.27 billion against $17.1 billion in revenue represented a net profit margin of only 13.2%, which was not particularly high within the typical Hollywood entertainment industry's 10% to 15% range. As long as Daenerys Entertainment's revenue did not significantly shrink, maintaining the 1993 profit level would not be difficult.
Would Daenerys Entertainment Group's revenue shrink? Considering the hot projects they held, like the DC Movie Universe series, Pixar Animation Studio, and the "Jurassic Park" series, this seemed unlikely in the next three to five years.
However, another narrative began to rise. Some Wall Street analysts believed that Daenerys Entertainment's performance had peaked. Although it wouldn't decline in the short term, further significant improvements would be difficult, thus doubting the long-term prospects post-IPO.
This view quickly gained recognition. Consequently, attention turned to Daenerys Entertainment's estimated IPO price-to-earnings ratio of around 20 times, deemed too high. Considering the potential slowdown in future performance growth, a more suitable IPO P/E ratio was suggested to be between 10 to 15 times.
Simon's bottom line for the IPO underwriters, Morgan Stanley and Goldman Sachs, was a minimum P/E ratio of 20 times. Based on the $2.27 billion net profit, the revised IPO valuation should be at least $45.4 billion.
Despite this high valuation, which would place the company among the top-tier global giants with a market value surpassing $50 billion post-listing, Simon was not willing to compromise, which inevitably caused some discontent among potential subscribers who preferred a lower IPO price to maximize profits.
Thus, negative sentiments emerged.
Simon was not worried about this. Most companies pursue IPOs to raise development funds, fearing failure, but Daenerys Entertainment did not share this concern. If not for the next phase of expansion, Simon wouldn't have needed Daenerys Entertainment to go public at all.
Therefore, even in the worst-case scenario of IPO failure, it wouldn't cause significant harm to Daenerys Entertainment, merely costing some investment banking fees.
Moreover, despite claims of overvaluation, everyone knew that few IPOs in recent years could match the quality of Daenerys Entertainment's stock. If there were any, they would likely still be within the Westeros system, such as Cisco or America Online.
Even Cisco and America Online, while promising, were still in growth phases with uncertain futures. In contrast, Daenerys Entertainment had already solidified its revenue and profits.
Malibu, Daenerys Studios.
The date was Friday, March 18.
Sensitive employees within the Westeros system noticed some changes despite the external noise.
Daenerys Studios had recently upgraded its security measures, with noticeable increases in personnel and surveillance equipment. The changes were most evident in the second-floor office area and the third-floor administrative area, where access procedures were tightened, barring uninvited visitors.
Most people attributed these measures to their boss's natural reaction to external pressures.
Only a few knew the real reason.
A week earlier, a young white man in his twenties suddenly drove into the Dume Point estate. He was intercepted by security just after entering the outer buildings. Unable to bluff his way through, he opened fire with an automatic rifle from his car. Fortunately, the security team, comprising mainly ex-special forces or police, quickly retaliated, killing him with precise shots to the head and heart. Subsequent searches revealed two rifles, numerous magazines, five grenades, and a suicide note stating his intent to kill all Westeros to return their wealth to society.
The incident was covered up, with the estate claiming it was merely a guard training exercise, and the injured guards were secretly treated at a private hospital.
The young man's identity was uncovered within an hour, and Simon led a team to search his residence but found nothing substantial. Despite not being a conspiracy theorist, Simon did not believe such events happened without reason and set up teams to investigate further.
The assailant and his car vanished, with strict non-disclosure orders issued to all involved.
Such incidents involving top tycoons and politicians were more common than the public knew, rarely exposed to avoid attracting imitators. This incident led to a full upgrade of the Westeros family's security measures, including in all public areas frequented by family members.
Jennifer, still shaken, prepared special bulletproof vests for Simon, insisting he wear them in public. When Simon joked about headshots rendering the vests useless, she burst into tears.
Simon, having experienced two lifetimes, was never particularly afraid of death but worried about those around him being harmed. Thus, he would not hesitate to strike preemptively if necessary.
Daenerys Studios Administration Building No. 1.
Larry Ellison left Simon's office after a firm handshake and a nod to the secretary outside.
Among the recent lawsuits targeting various Westeros system companies, Oracle's dispute with competitors Informix and Sybase was notable. While the public response on Egret Portal was firm, Simon knew Ellison was not above using underhanded tactics, crucial in cutthroat business competition.
Simon had no objections, provided the issues were handled properly. Today's meeting was for Ellison to explain the situation and outline his response plan.
As Ellison departed, the secretary followed Simon back into his office, carrying several documents.
Simon sat at his desk, setting aside an open script titled "Broken Arrow," a new project from MGM's "Speed" screenwriter Graham Yost. With "Speed" due for release this summer and receiving positive reviews, MGM had signed Yost for his next project. The script, centered around a nuclear weapon incident, was similar to the upcoming "True Lies" featuring Schwarzenegger dealing with a nuclear crisis.
Setting aside minor doubts, the secretary handed Simon a folder, saying, "Boss, these are the files recently sent from Greenwich about the candidates targeting the Westeros system. Mr. Schlapp has identified 23 individuals, including seven Democrats and sixteen Republicans, with three senatorial candidates and twenty congressional candidates, two of whom are incumbents."
Simon listened as he opened the first folder, listing the 23 candidates, with notable figures like Connecticut's Democrat Representative David Meroth, backed by the Hearst family, and Wisconsin's Democrat Senator Craig Ames, who proposed an 'asset tax.'
Both Meroth and Ames were particularly active against the Westeros system, despite being from Simon's supported Democratic camp. Most Republican critics, in contrast, were less vehement.
The files included detailed information on the candidates, their political histories, and recent statements against the Westeros system.
Gesturing for the secretary to continue, Simon heard her say, "The next file contains information on their main opponents and a recommended leader for the Wisconsin sniping team, Paul Spaits, 37, from Milwaukee. A graduate
of the University of Wisconsin, Spaits previously led Verizon's lobbying department and corporate PAC, with over a decade of experience in Milwaukee's political landscape."
The Westeros system would not remain idle amidst media and political attacks.
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