Richest man

Chapter 35 Oceania: Kerry Parker (2)
Within a few years, cricket was Kerry's gold mine.Entering the 90s, Nine won 99% of the broadcast time of international test matches and one-day cricket matches, and won 50%-75% of the fan ratings.On the other hand, the cost of broadcasting a cricket match is much lower than that of all other television programmes.If you broadcast TV dramas with the same time and the same ratings, the cost will be 80 times higher; even ordinary TV sketches will cost 16 times more production costs.Therefore, the cricket game has created a high profit for the Nine.Even though it has made a lot of money, the broadcast fee paid by Channel 100 is still very low, about 200 million to 1992 million yuan per year.In contrast, Channel 6000's broadcast of the [-] Olympic Games, which set a new ratings record, cost an unbelievable [-] million yuan in two weeks.Kerry's relentless struggle finally made him live up to his father's expectations and showed that he could break new ground through his own efforts.

Kerry was convinced that television was more valuable than newspapers because he loved watching it.Most importantly, he knew that the masses wanted TV, and had the same tastes as himself.After all, the advanced vision and sense of smell come from the observation and love of life!
Attack: Calculating like a fox, swift as a tiger

Kerry's principle of making money is: buy at the right time and sell under favorable circumstances, profiting from cheap sales.Looking at the history of Kerry's fortune, his capital strategy of "snakes swallowing elephants" and "stealing by stealth" is amazing.Here are a few examples.

In the 20s, people were amazed to learn that the Parker family owned only 70 percent of United Newspapers.In the public image, the Parker family has always controlled the sprawling empire; Kerry and his father treated the company like a grocery store and did whatever they wanted; the true ownership relationship was kept secret except for the Parker family and their advisors Only then did I know the inside story.Until 25, Frank owned half of the company's capital.Then, ostensibly to raise cash, they decided to sell half their stake, or 1972 percent of the company's capital, worth just over $25 million.

Despite the sale, the Parker family still maintains a firm grip on the empire because it is sold to the company itself; however, the company only owns an inexplicable 23 percent of its own stock.However, the 1972 share sale, and the intertwined ownership of the shares, did not become known until 1980, when Kerry attempted to repurchase the shares.After knowing this, the shareholders of the company were very dissatisfied. They were dissatisfied not only with the private transaction at the beginning, but also with the long-term concealment of the truth, and even more dissatisfied with the fact that such a large amount of money was used by others.

Kerry's initial attempt to buy back the company's shares in 1980 failed.He only proposed a purchase price of 400 million, which was lower than the trading price in the stock market, so the company explicitly denied his request.But almost three years later, Kerry tried again, this time with great ambitions, this time buying up all of Consolidated's shares in public hands, which meant turning the company back into the private sector.

Kerry encountered a once-in-a-lifetime opportunity-Australia is in a period of economic recession, and this is a good opportunity to buy back public stocks at the lowest price.

According to rumors, Kerry once again succeeded in taking the company private, and that's how it started. On a weekend night in 1982, he met the boss of a commercial bank next door and asked him if he would do the business for him.The owner of the now-defunct bank promised to give it a try, but he said he was not sure because Kerry's bid was very low at that time, only willing to pay 5 yuan a share for the purchase price.On the surface, this seems quite generous, because United Newspapers' profits have always been very low, and shareholder dividends are meager, so the stock market was less than 3 yuan per share at that time.

Kerry's advisers have privately suggested that such an annexation purchase usually cost about 10 yuan, which is twice his proposed price.Otherwise, it will be difficult to induce the company's shareholders to sell their shares, and it will be difficult to find an independent equity expert to evaluate that this is a reasonable transaction.However, Kerry's advisers later came up with two brilliant ideas.

First, according to the regulations of the National Company Securities and Exchange Commission, any merger and acquisition of a company must obtain the approval of 90% of the company's shareholders.The clever trick of Kerry's consultants is to convert the shares into preferred shares first, so that 75% of the votes can be obtained at a special general meeting of shareholders.Another neat thing about this gimmick is that Kerry himself allowed the vote to convert the shares, thus keeping the plan going.In fact, the purchase of preferred shares at 5 yuan per share is just a formality, and acceptance of the company is already a fait accompli, because preferred shares do not have voting rights.The second is to change the name so that the price of 5 yuan per share has a higher actual value in the hands of shareholders.

The second, simpler strategy is to switch from the one-time dividend payment to a recurring tax-free dividend, so that the company can be persuaded to back the whole deal.Because using this plan, the cash price of 5 yuan per share can be raised to the stock price of 8 to 9 yuan, which is exactly what the company is looking forward to.If some major shareholders still think that the stimulus is not big enough and they are unwilling to resell, then they will be told: this is the only way out, otherwise they will stay in the company forever, facing stock price cuts, meager dividends, and being held by Kerry. Tightly control.

However, Kerry has to face a more serious problem, that is, the transaction still needs to be reviewed by independent experts to confirm whether it is fair and reasonable.A local accounting firm was responsible for this work, and their conclusion was negative.Because they assessed the price per share at 6.89 yuan, which was significantly higher than Kerry's bid, so this transfer transaction was unfair and reasonable.

Surprisingly, the deal was possible nonetheless, because the experts would have to tell the independent directors to decide whether their assessment was acceptable.Shareholders were then faced with the brutal fact that they could not hope for a better buyer.Kerry's bid was low, but already 28% higher than the original bid on the market, and there were no other potential buyers.It can be seen that although it is unfair, it is the highest price that shareholders can get.In view of this, the accounting firm had to give the green light to Kerry's bid of 5 yuan per share and recommend the transfer transaction to the directors.

For Kerry, the annexation transaction and the timing of the transaction are excellent. He bought shares with an output value of 2.2 million yuan, but only spent half of the money.Even better, he didn't actually take a dime out of his own pocket.According to a bank boss who engineered the entire deal for him, Kerry went from a 25% stake to gobbling up the entire stake in one go, putting the entire company under his control without even touching his wallet.The 1.1 million yuan that was spent was actually not paid by Kerry, but purchased all the shares in the hands of the public through subsidiaries such as the United Press Holdings Company; but their funds came from bank loans. The bank bosses also took a fancy to the high-value assets of United Newspapers and borrowed money one after another.

The assets annexed by Kerry soon appreciated dramatically.After three and a half years, he sold the two Nine TV stations in Sydney and Melbourne to another tycoon, Alan Bond, for a price of up to 10.5 billion yuan, all of which went into his personal pocket.Five and a half years later, he sold half of the company's magazines at a high price of 11.75 billion yuan.That is to say, in nine years, Kerry's privatized assets, which were almost penniless, actually brought him a profit of 20 billion yuan.

The subtle calculations like a fox and the swift attack like a tiger and wolf made Kerry's wealth rapidly expand.In positive terms, he is a strategic investor who is good at capturing opportunities and knows when to buy and when to sell.But on the other hand, it is indeed a kind of "stealing and usurping", no wonder some people call it a "demon".

Mergers and acquisitions: depends on the ability to integrate

In capital operation, if you want to eat "shock fish", you must first have the ability to activate "shock fish".Kerry's ability lies not only in keenly capturing business opportunities, but also in his "uncanny craftsmanship" in bringing "shock fish" back to life.

Here is an example of mergers and acquisitions worth mentioning: in April 1989, Kerry purchased Australia's largest engineering technology company for 4 million yuan.Kerry often likes to buy companies in crisis, and this is a prime example.At that time, a commercial bank invested by the company went bankrupt, resulting in a shortage of funds, and the market stock price fell. The company will face a loss of 3.8 million yuan.Kerry decided to buy the company, because he thought that as long as he injected a sum of money, he could stabilize the position and not sell it cheap and collapse.Although some people thought he had courage, there were very few people who supported him at the time.After Kerry took over, he improved its management.In the following 2 months, he performed a major operation on the company. All unnecessary links in operation and management were cut off, and the factory closed down, reducing the loss from 15 million yuan to 5.7 million yuan. Prices also rose. When Kerry sold the company in 2.4, he made $1991 million.Of course, sadly, many people lost their jobs because of this.

Another notable example: Kerry bought an advertising production company from the Americans in December 1986.This company named Veras specializes in the design, production, and printing of product advertising catalogs, sample brochures, and purchase advertisements, etc., and distributes them in major newspapers on Sunday.Some large manufacturers and retail companies attach great importance to this form of advertising, so they can regularly issue products that they particularly need to promote (including discounted prices).This is a fast-growing industry in the United States, and Veras has a monopoly position in the market, owning almost 12% of the market.

However, Veras's operations in Australia are not doing well.When Kerry bought it for 5.2 million yuan, the company was still at a loss.Two years later, things are very different.This is mainly because Kerry took control of his two competing companies in 1988, ending the business-grabbing price war.In the next fiscal year, mainly by effectively raising prices, Van Rath's profits increased by 40%, making a total of 1991 million yuan in 2.11.

It is worth mentioning that the reason why Kerry was able to control the two competitors was also thanks to his old friend Murdoch, who bought one of them, and the other was annexed by Van Las. .It is precisely because of Murdoch's involvement in this industry that Veras became a large company worth 1992 billion yuan in 17.1.This is also a very interesting example, from which we can get a glimpse of the two tycoons in Australia. Although they both had great ambitions to monopolize newspapers and television in the 90s, they also used each other.

Secret: Gamble wildly but never take the whole house as a bet
Kerry has a strategic vision and can instinctively predict the needs of the market.He is daring and quick to attack. He is far less refined than his father in small things, but he has a tighter grasp on big business than anyone else.Anyone who has dealt with him knows that he is greedy, hates losing money, and always wants to win. In fact, he is indeed a gambler, and many investments are random.His weakness is that he is ready to buy almost everything and listens to his friends too much.People would often call him to persuade him to buy a stake in a company or support a new joint venture, and Kerry would agree on a whim.

For example, his failure to invest in real estate.That was Kerry's attempt to take advantage of the real estate boom in Queensland's Gold Coast to make a fortune. However, because he moved too slowly, the real estate market suddenly became turbulent and prices dropped sharply, causing his company to face a loss of almost 1000 million.Fortunately, Krita thought it was early, and immediately withdrew the funds and dismissed the manager in charge of the investment.

Therefore, although Kerry is a gambler, he is a gambler who can keep the bottom line at any time.The fact is also true, Kerry has the characteristics of a gambler, but at the same time he is more cunning like a fox. This is reflected in the fact that he is not only good at capturing opportunities and making money from cheap transactions, but also adheres to an important principle, which is to work with some players in the market. Do business with companies that have a monopoly, or at least a majority stake, in the world.When he bought an existing business, he would do anything to improve it, to make it more efficient so that it would be more valuable when it was sold.

(End of this chapter)