Exploiting Hollywood 1980.

Chapter 1463: Listing Bell
"Hello, I'm from Fidelity Magellan Fund. Mr. Lynch has decided that if the price is $20, we want 100 million shares; if it is $22, we want 80 shares; if it is $24, we want 60 shares."

"I am from the New York State Common Retirement Fund. I want 20 shares for $50..."

At midnight on the day before DDH went public, CEO Ed Bastian sat in the IPO office of Goldman Sachs, watching the hotline ringing non-stop and the fax machine spitting out quotes from all over the world.

Standing in front of him, constantly reading faxes and getting the latest bids from the operator, was Rich Bressler, the CFO that DDH Media had snatched from Time Warner. This young and promising executive was originally a partner at Ernst & Young. Later, he entered the media industry, engaged in the acquisition of TV stations and radio stations, and established a strong network of relationships on Wall Street.

He and Bastian, together with Goldman Sachs' IPO department, received very good reviews in the road show and were expected to be oversubscribed by about ten times.

The roadshow received very good feedback, the main reason of course being the high asset quality of Ronald's DDH Media, but another reason that cannot be ignored is the impact of Viacom's loss-making acquisition of Paramount Media.

Although Redstone's net worth and that of Viacom have shrunk significantly this time, his determination to acquire Paramount at any cost and even at all costs was interpreted by some Wall Street analysts as an increase in the industry's valuation of large media groups.

In other words, although this acquisition hurt the small shareholders of Viacom and Blockbuster, Paramount Media did not become worthless. Coupled with Barry Diller's bidding, the final acquisition price was raised by 50%, which also led to Wall Street's new understanding of a newly listed medium-sized media company.

After 2 a.m., it was time for major investment institutions across the United States and even the world to bid for DDH Media's IPO. The fluctuating ringing of telephones and the non-stop operation of several fax machines indicated their enthusiasm for the company.

These companies do not have only one price for IPO subscriptions. They quote prices based on possible prices and quantities. If the listing price is set lower, then more shares will be purchased; if the listing price is set higher, then fewer shares will be purchased.

There are repeated bargaining involved. If the number of subscribers exceeds the allocated quota by too much, the price and number of shares may be temporarily changed to allow more subscribing institutions to buy high-quality listed stocks.

These subscription institutions are mainly divided into mutual funds, pension funds, insurance funds, hedge funds, and Goldman Sachs' proprietary institutions. The prices they offer are also different. Some offer tiered prices like the Fidelity Magellan Fund managed by Peter Lynch, while others only offer an upper limit price.

During these two hours, it was like a vegetable market, with Goldman Sachs employees constantly receiving various quotations, then quickly organizing them using software, and printing them out into various tables and charts to facilitate senior executives in making the final decision.

The bidding atmosphere is very exciting. With every additional bid and every higher dollar, the bonuses and options of everyone present will continue to increase in wealth.

Before I knew it, two hours had passed. The large whiteboard hanging on the wall was already densely packed with quotations from institutions and figures, which really made one's blood boil. Even the green woolen curtains seemed to be covered with a golden and green glow when illuminated by the light, which made one's heart beat faster at a glance.

"The chairman is here!"

Suddenly, someone recognized Ronald who had just walked in. Behind him was his friend, Douglas Hansen Jr., the second largest nominal shareholder of DDH and the representative of the old money family of Staten Island.

"What's the situation?" Ronald walked straight to CEO Bastian. In another ten minutes or so, the quotation time would end, and then it would be the crucial time to set the issue price. After that, they would have to confirm with major institutions, and then everyone would go to the New York Stock Exchange to hold a press conference, and finally wait to ring the bell for today's opening.

"It can be said to be the best case scenario we expected..." Ed Bastian's face was full of smiles. Thanks to this hot offer, his options have increased by at least 20% compared to his original psychological expectations.

Everyone has raised the price of this type of media stock. There are also some expectations for growth. Unlike a long-established company like Paramount, DDH's asset package does not have many depreciated assets, and it is expected to continue to generate considerable cash income for the listed company in the next five years.

Among the domestic investment funds, there are Fidelity’s Magellan and Counter-Trend funds, Vanguard’s 500 Index, T. Rowe Price’s Growth Fund, and several small funds under the Putnam Group.

Several major pension funds, including the New York State Common Retirement Fund, the New York Police and Firefighters Retirement Fund, the California Public Employees' Retirement System, the California Teachers' Retirement System, etc., have all made offers.

There are two other funds that generally do not make aggressive investments. The Texas Teachers and Public Employees Retirement Fund also participated in the subscription. Before Ronald came, George Jr. had asked someone to tell him that since George Jr. was preparing to run for public office, he would not personally participate in this IPO. The couple's personal investment was only intended to make some money legally and reasonably by investing in the secondary market after the listing.

In addition, insurance companies such as Prudential Financial, MetLife, and New York Life also participated in many subscriptions, but their subscription prices and amounts were relatively conservative.

Hedge funds, including Tiger Fund and Soros Fund, are relatively aggressive in their bids. Of course, this is their usual style, and Goldman Sachs does not intend to give them too much quota. These funds usually sell quickly after listing to realize profits, which is not very conducive to the stability of stock prices.

What is more surprising is that international investment institutions are also very interested in this company, such as the National Pension Service of Korea, HSBC and Jardine Matheson Asset Management in Hong Kong, etc.

Although DDH also went to East Asia for a roadshow, the fax they sent contained limit orders, which meant that as long as the price was below theirs, they would buy all the reserved shares at the issue price, no matter how much the price was. This was a pleasant surprise.

This shows that these East Asian subscribers have a higher evaluation of DDH than ordinary investment institutions. Goldman Sachs is not sure why they value an American media company so much. If DDH's scale is not large, they would think that the Japanese are going to invade the American media industry after Sony and Panasonic.

All in all, we have now received 10 times of oversubscription, which is a very optimistic result in the current stock market environment. It is estimated that after listing, the stock price will rise appropriately, for example, to more than 30 US dollars, giving these subscribed funds a reserved profit space.

"Squeak..."

At this moment, the fax machine rang again, and another subscription offer came in. CFO Rich Bressler rushed over and tore off the first page.

"AIG-American International Group, two million shares, market order... and, God, this is a personal note from Chairman Greenberg..."

"Hahaha..." Ronald, together with the chairman, received the appointment letter as a foreign expert. When on the plane, Maurice Greenberg jokingly said that he wanted to cooperate with him in the future. I didn't expect him to come now.

The market price order is the highest compliment to a listed company, which means that no matter how much your IPO price is, he will buy it at this price. Although this offer is rare, in the eyes of Goldman Sachs, what is even rarer is the autograph of Maurice Greenberg on it, which fully believes in the potential of DDH Media.

"Squeak..."

Several more faxes came in, and this time the quotes were even more surprising than AIG's. They were from the Japanese Government Pension Investment Fund and Nomura Investment Fund in Tokyo.

The former is the largest pension investment fund in Japan. It is rich and powerful, and rarely participates deeply in international IPOs. This time, it also made a market price offer, buying in large quantities without considering the purchase cost.

Nomura Investment Fund, in addition to being one of the largest investment institutions in Japan, also has some of its funds, which are actually private investments of some wealthy people. It is also a market order with no price limit, as if it was specially made to support the listing of DDH.

"Haha, it's our friends in Japan..." Ronald smiled. The bureaucrats of the Ministry of Finance still remembered the last time he and Bannon speculated in Japan. Coupled with the influence of Mr. Ohga, Japan's evaluation of his media company was quite high.

"Squeak..."

The last one was an offer from an investment company from Hong Kong. The number of shares purchased was very small, but the company also placed a generous market price order.

"Huh?" CFO Rich Bressler looked at Ronald in confusion. Such a small order, and it was accompanied by a market order. Where did it come from? Anyway, the subscription from East Asia was largely brought about by the chairman's personal influence. No one knew what was going on this time.

"Just give them a quota as usual..." Ronald smiled. Anyway, it was through Hong Kong's investment department, so it didn't matter. Just treat it as a friendly gesture. Maybe they wanted to learn about IPOs in international investment, and they felt that they would definitely not cheat them.

Ring, ring, ring…

After a bell rang, all the bids were concluded. People from Goldman Sachs' investment banking department and DDH Media, led by Ronald, sat down together and began to discuss the pricing of the issue price.

"We are very happy with the subscription scale. We are already oversubscribed 25 times. If we follow our original maximum issue price of $, I think many bids will be very disappointing. If we follow the subscription price curve, many people will not be able to get the right shares."

The final subscription situation compiled by Goldman Sachs and DDH. If the subscription exceeds the original expectation, then generally speaking, the investment bank will formulate the final share quota of the investment institution based on various principles.

For example, pension funds and mutual funds will get better quotas because they tend to hold stocks for the long term, while hedge funds will be allocated smaller quotas because they will quickly buy and sell stocks for short-term profits, which is not conducive to the stability of stock prices.

In addition to market orders, limit orders, and tiered bid orders, the shares are allocated in priority according to everyone's bids. Generally speaking, the limited shares are allocated according to the ratio of your bid and shares.

Of course, such a popular IPO will make many institutions that made bids dissatisfied. If they can only buy one-tenth of the originally expected shares, it will offend some institutional investment managers.

"Our suggestion is to increase the issue price from $25 to $27. The scale of the issued shares should be increased from the original 2500 million shares to 2800 million shares. With strong demand and oversubscription, the number of issued shares and the issue price should be increased at the same time, so that the investors who subscribed 15 times will not feel neglected."

"Well, in that case..."

Ed Bastian took the plan. He was also a CEO who was a partner of an accounting firm and was very good at financial numbers.

The adjusted issuance volume accounted for 28% of the total share capital. With an issue price of $27, the total market value after the opening was $27 billion. The funds raised exceeded the initial most optimistic estimate of $6.3 million and reached $7.6 million...

Bastian explained to Ronald in detail the good start that the hot IPO had brought to DDH Media, and then held a pen and asked him to make a decision.

Ronald picked up the pen and asked everyone in high spirits, "Is everyone satisfied now?"

"Satisfied! Perfect! Bravo!" Everyone at the scene was a person who could earn 10% more through this temporary adjustment plan. They all smiled and clapped their hands hard.

Ronald signed the pricing plan amid applause, and then everyone went back to pick up their phones to inform investors of the latest prices.

Looking at the busy office, Ronald checked his watch. It was already six in the morning. Ronald looked at Doug next to him and they smiled at each other. As the main shareholder, Doug represented the company in the end, along with Donna's trust. When Doug attended the press conference and the bell ringing ceremony, his shares in the original investment also made him a billionaire. The Hanson family became the first Staten Island old money family to occupy Manhattan and leap onto the stage...

"Have some breakfast, what do you want to eat?" Ronald smiled and went out with Doug Jr. They didn't have much work to do here anymore. They were just waiting for the announcement of the issue price at seven o'clock and the press conference at eight o'clock.

"A cheeseburger... plus a can of Coca-Cola... hahahaha..."

"Then a cheeseburger and a Coke..."

Ronald also laughed. This kind of fast food was what filmmakers often used to fill their stomachs while filming. As a person who started his career in the film industry, this kind of food was perfect for him to eat when his company went public.

……

At eight o'clock in the morning, DDH Media's listing press conference officially began in a conference room of the New York Stock Exchange.

"I'm from the Wall Street Journal. Could you please elaborate on the company's development strategy for the next five years?"

"Investor News, what do you think of the temporary increase in the IPO price and issue size, and the oversubscription of more than 10 times?"

“New York Times, how will the funds raised from the IPO be used? Are there any specific acquisition or expansion plans?”

“The Washington Post, what do you think is your company’s unique advantage compared to other media companies?”

……

CEO Ed Bastian, on behalf of DDH Media, answered questions from financial media reporters one by one.

"Hollywood Reporter, Ronald, may I ask, as the chairman of a listed media company, will you still direct a movie yourself?"

All of a sudden, all the reporters and company management focused their attention on this reporter's face. How did the scene suddenly turn into a Hollywood new movie launch?
"I am happy to answer your question. This is probably one of the few questions that I am suitable to answer..."

"Hahahaha..." The reporters all laughed. As the chairman, Ronald had let the CEO answer all the questions about business operations. But he answered an entertaining question in a very humorous way.

"I will continue to direct. There are many directors in Hollywood who are worth more than me (according to the apparent shares, Ronald's share is still not as much as Spielberg and George Lucas). I will continue to direct the works I like. I may have more choices than before when choosing scripts."

"Dangdang..."

When the market opened at 9:30, Ronald, Doug Jr., and CEO Ed Bastian rang the exchange's bronze bell. The bell echoed for several seconds, and the exchange below suddenly became noisy, and traders began to openly shout prices like a vegetable market.

"27, 28, 29, 30..."

The stock code DDH suddenly received a large amount of capital after the opening, and the price continued to rise, and soon broke through thirty dollars...