The Entertainment Industry in Turmoil: Young Actresses All Want to Rise to the Top

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On November 1st, after the Frost's Descent, the morning in the capital was chilly.

Fifteen working days have passed since Alibaba and Tencent announced their share reduction plans.

After a brief but weak resistance, Huayi Brothers' stock price declined again at the opening of the stock market, eventually settling precariously at around 12.5 yuan.

It is just a step away from the all-time low of 12.15 yuan set after the disastrous failure of "1942" in 2012.

In just a few months, it felt like a lifetime had passed.

This was once a promising private film company, aiming to break the 100-yuan price mark and become the first listed private film company.

With a total share capital of 4.44 million shares, its market value has plummeted from nearly 400 billion at its peak to less than 56 billion.

In this hunt, Mohen Asset Management, Tencent Pictures, and Alibaba Pictures each reaped astonishing profits of over 17 billion yuan by strictly controlling their short-selling operations to below 5% of the shares.

But the real harvest has only just begun.

A new institution called Changfeng Fund quietly emerged and began to contact Huayi's minority shareholders.

This fund was registered recently and has an ordinary background, but it is extremely efficient in its execution and has very strong financial resources.

The small and medium-sized shareholders of Huayi, who hold a small percentage of shares and are suffering greatly in the current atmosphere of despair, as well as some celebrities, have expressed despair about Huayi's stock price.

It's worth noting that Alibaba and Tencent only announced their share reduction plans 15 working days ago, meaning they can only begin reducing their holdings today.

But by this time, the stock price had already fallen to 12.5. If it is confirmed that they have indeed reduced their holdings, the price will only go lower, and perhaps in the end, these stocks will be nothing more than worthless pieces of paper.

Changfeng Fund, which has suddenly appeared, is willing to acquire Huayi Shares in cash at a price 10%-15% above the market price.

This price is far below the cost price for these shareholders, but compared to the bottomless expectation of a decline and the current liquidity crunch.

This cash acquisition was like a lifeline.

"Mr. Wang is already in dire straits himself; who knows if the stock price will plummet to single digits?"

"Changfeng Fund has a strong background and can settle in cash in one go, so it's best to secure your profits."

"The waters around Huayi are too murky; it's better to get out sooner rather than later."

Such thoughts began to take root in the minds of many minority shareholders.

For these small investors, cutting their losses and leaving the market to recover some of their principal is better than going down with Huayi's sinking ship.

The agreement was signed, the shares were transferred, and the funds were received; the transaction proceeded discreetly and efficiently.

Changfeng Fund's shareholding ratio, like a slowly rising water level, is quietly approaching the 5% threshold that requires public disclosure.

At the same time, Wang Zhongjun and Wang Zhonglei were truly experiencing what it meant to be "when the wall falls, everyone pushes it down; when the drum breaks, everyone beats it."

First came the bank's debt collection letter.

Huayi previously obtained huge loans from multiple banks to build several "movie-themed towns".

Now that Huayi's stock price has collapsed and its reputation is ruined, this project has been assessed as a "key concern" or even a "non-performing asset" risk.

Strongly worded inquiry letters and risk warnings followed one after another, demanding that Huayi provide additional collateral or new guarantees in advance.

They even hinted at the possibility of prematurely withdrawing loans.

This was followed by demands for a share of the profits from the partners.

It's not just Stephen Chow; investors, distributors, and even cinemas that previously collaborated with Huayi Brothers on several films and TV series have begun to intensify their efforts to collect outstanding box office revenue sharing and copyright fees.

In the past, the payment terms that could be slightly delayed by leveraging their industry position have now become extremely difficult to achieve.

Some partners even threatened to take legal action and freeze Huayi's assets if the settlement was not made.

Every collection request is consuming the already dwindling cash reserves, and every payment made is further damaging Huayi's already fragile cash reserves.

And the most fatal, and also one of the most core assets, artist management, is now backfiring.

Those top artists who hold a large number of shares may be temporarily unable to act due to personal relationships and vested interests.

However, many mid-career and new generation artists have already begun to secretly contact other companies.

Companies including the then-booming Mohen Media, Fiber Optics, Bona, and even the newly ambitious Tencent Pictures and Alibaba Pictures, have all begun poaching talent from Huayi Brothers.

Privately, I've been receiving a constant stream of phone calls inquiring about the possibility of terminating my contract and the terms of my transfer.

Even worse, some have begun to use health reasons to delay or cancel work arranged by Huayi.

The disintegration of people's hearts terrified Wang Zhongjun more than the drop in stock prices.

The internal situation was equally chaotic.

The senior management team is in turmoil, middle managers are starting to quietly update their resumes, and ordinary employees are shrouded in the shadow of layoffs, pay cuts, or even company bankruptcy.

Work efficiency and morale plummeted.

Wang Zhongjun's office was filled with smoke, becoming the most oppressive and desolate place in the eye of the storm.

The ashtray on the desk was already overflowing with cigarette butts.

His eyes were bloodshot as he stared blankly at the piles of bad news on the table.

"Brother...are we...are we really finished?"

Wang Zhonglei's voice trembled slightly, and his former arrogance was nowhere to be seen.

Wang Zhongjun did not answer, but stared intently at the stock price chart of Huayi on the computer screen.

At that moment, the secretary knocked on the door and entered, her face unusually grave.

"Chairman Wang, President Wang... There is a person in charge of Changfeng Fund who would like to schedule a time to meet with you two."

"I'd like to discuss Huayi's overall solutions."

What was bound to happen has finally happened.

Wang Zhongjun slowly closed his eyes, took a deep breath, and when he opened them again, all that remained was the numbness of utter exhaustion.

And a flicker of defiant struggle.

"Let's make the arrangements."

His voice was so hoarse that it was almost inaudible.

"Also, contact Shen Mo, and also Alibaba and Tencent."

"I, Wang Zhongjun, would like to invite them to sit down and have a talk."

"What Changfeng? Stop wearing a mask and just come at me."

If he still doesn't know who his opponent is at this stage, then all these years in the business world have been for nothing.

He knew that he had very few chips left in this game.

However, at least there's still a chance of a desperate, all-or-nothing outcome.

It's time to discuss a perhaps less-than-dignified ending for Huayi, a company we founded ourselves.

The next day, the appointed time arrived.

The secretary silently pushed open the door to Huayi's conference room, and a group of people walked in.

The three people who walked in and sat in the middle were the very opponents that Wang Zhongjun least wanted to see, yet had no choice but to meet.

Tencent Pictures CEO Sun Zhonghuai, Alibaba Pictures CEO Zhang Qiang.

And the one sitting in the center, who was excessively young yet extremely composed and shrewd, was none other than Shen Mo.

His expression was calm, without the arrogance of a victor or any deliberate oppression.

Sitting behind them were several capable-looking men and women, the core members of the Changfeng Fund, which was established to handle mergers and acquisitions.

There were no small talk, not even a polite handshake.

Wang Zhongjun took a deep breath and straightened his slightly hunched back.

His gaze swept over Shen Mo, Sun Zhonghuai, and Zhang Qiang, his voice hoarse yet struggling to maintain a semblance of decorum:

"Gentlemen, that's quite a skill."

"I never expected that Huayi would be worth the alliance of three companies."

Sun Zhonghuai pushed up his glasses, his tone indifferent.

"Chairman Wang, you flatter me."

"As a former partner and shareholder, we are also unwilling to see the situation completely out of control when Huayi encounters difficulties."

"That's why we're having this conversation today."

Zhang Qiang picked up the conversation and got straight to the point.

"Chairman Wang, time is precious, and you are aware of the situation."

"The company that wants to acquire Huayi is not any of the three companies: Tencent, Alibaba, or Mohen, but Changfeng."

"We're here today simply to help Chairman Wang and Changfeng explore a relatively safe solution."

"After all, the collapse of Huayi's brand is too ugly, which is not a good thing for the industry or its practitioners."

"We want to work together to find a soft landing plan for Huayi."

His words, seemingly lenient, actually disguised the "acquisition" as a "rescue," thus occupying the moral and industry high ground.

Wang Zhongjun's face remained expressionless, but his teeth were practically grinding to powder.

He knew he lacked the strength to compete with these three combined, but he had to fight!

For Huayi's sake, and also for my own last shred of dignity and interests.

"A soft landing?"

Wang Zhongjun sneered, his eyes flashing with the fierce determination of a cornered beast.

"Huayi has encountered some setbacks, but its foundation remains intact!"

"The value of our film library, our production capabilities, and our distribution network—these core assets haven't disappeared!"

"Temporary fluctuations in stock price do not mean the company has no value!"

"If you want it, you can have it!"

"Offer a price that reflects its true value!"

"Instead of taking advantage of the chaos!"

He tried to emphasize Huayi's remaining value in order to gain leverage in negotiations.

Shen Mo listened quietly, glancing at the agitated Wang Zhongjun.

"Chairman Wang, when discussing value, we must first recognize reality."

He extended the first finger.

"First, Alibaba and Tencent together hold more than 10% of Huayi's shares. The announcement of the reduction of holdings has been issued, but the formal sale has not yet begun."

He paused, then continued, "If we start selling now, given the current market conditions and sentiment, do you think we can hold the price of 12 yuan?"

"Will it end up being 10 yuan? Or 8 yuan?"

"By then, how much of Huayi's market capitalization will be left to discuss its value?"

Wang Zhongjun's throat went dry. He wanted to retort, but found himself speechless.

This is the most direct sword of Damocles hanging over Huayi's head.

Shen Mo extended his second finger.

"Secondly, in the past few months, you have cashed out more than 1.5 billion yuan through various channels."

His gaze shifted to Wang Zhonglei, whose face was deathly pale, and then back to Wang Zhongjun.

"This money was withdrawn when Huayi's stock price was relatively high."

"As a major shareholder, he didn't think about running the company properly, but instead thought about cashing out and securing his profits."

"We understand, but now that the money is already in hand, isn't it a bit less convincing to talk about it for Huayi now?"

"What would the market think if it knew these details?"

These words completely destroyed the Wang brothers' moral high ground.

Shen Mo didn't stop and continued to extend his third finger.

"Third, things haven't been peaceful at Huayi recently."

"Third, things haven't been peaceful at Huayi recently."

"Do you think it's possible that some people who choose to leave might take some materials with them?"

"Of course, I certainly don't know what materials they are."

"But I guess it'll probably just be some emails, or contracts, financial data and the like."

Wang Zhongjun's pupils suddenly contracted, and his eyes were fixed on Shen Mo.

"If, I mean if..."

"These things have been revealed."

"Chairman Wang, General Manager Wang, what do you think the outcome will be?"

Shen Mo leaned forward slightly, his gaze falling on Wang Zhongjun's face.

"I think Changfeng is willing to discuss a comprehensive plan since he came over today."

"You mean, is that so?"

The office was deathly silent.

Sun Zhonghuai and Zhang Qiang did not speak, but their silence itself was the strongest support.

Meanwhile, the members of the Changfeng Fund behind them had silently opened their briefcases, revealing thick draft agreements inside.

Wang Zhongjun seemed to have all his strength drained away, and slumped back in the high-backed chair.

His reasoned arguments and resentful struggles seemed to have been shattered.

The fish died and the net was broken?

The net may have a hole, but the fish will die a horrible death, and be utterly worthless.

He slowly closed his eyes, as if he had aged ten years in an instant.

When he opened his eyes again, the last glimmer of resentment had finally died out, leaving only endless exhaustion and resignation.

Tell me your terms.

Shen Mo and the other two did not stand up. Xu Li, the chief negotiator of Changfeng Fund, stepped forward.

He presented the specific acquisition plan to everyone.

The valuation is roughly based on the current market capitalization of 52.8 billion yuan, with a certain premium, bringing the total price to 55 billion yuan.

The company paid 19.25 billion yuan to acquire all 35% of the shares held by the Wang brothers and their affiliates.

The premium portion is considered as a buyout refund fee.

The transaction payment method is divided into two phases.

The first installment of 40%, or 7.7 million yuan, will be paid within five working days after the agreement is signed and announced.

The second phase, amounting to 60% or 11.55 billion yuan, will be paid after the share transfer procedures are completed, the filing and public announcement are made, and the asset liquidation is finished.

Installment payments mean that the Wang brothers cannot take the money and leave immediately. Their interests are still linked to the success of Huayi's cleanup efforts, and this also prevents them from causing trouble after receiving the money.

Finally, there are some standard practices, such as liability separation and non-compete agreements.

Wang Zhongjun listened silently, without interrupting or asking any questions.

Wang Zhonglei tried to speak several times, but he was firmly stopped by Wang Zhonglei's eyes.

After Xu Li finished speaking, he took half a step back.

Shen Mo then spoke again, his tone softening slightly.

"Chairman Wang, we believe that Changfeng has offered the best terms."

"Please believe that Huayi will continue to exist in another form, the livelihoods of its employees will be sustained, and the industry will be spared a greater upheaval."

Sun Zhonghuai added, "Chairman Wang is a smart man and should understand that when it's time to make a decision, one should make it decisively."

Zhang Qiang said calmly, "After all, dragging this out won't benefit anyone."

Silence fell in the office once again.

Wang Zhongjun slowly raised his head, his gaze sweeping over the people who had determined his and Huayi's fate.

He reached out and grasped the cold pen, his fingers turning slightly white from the pressure.

"Where should the agreement be signed?"

These words, though spoken lightly, carry immense weight.

Xu Li took out a thick stack of beautifully bound agreement texts from the document box, turned to the signature page, and respectfully placed it in front of Wang Zhongjun.

The legal staff stepped forward and briefly pointed out the location of the key clauses.

Wang Zhongjun didn't look at the details anymore. He knew that the details had already been polished countless times by the other party, and his struggle at this moment was meaningless.

He bent down, the pen tip hovering over the paper for a full three seconds, and then fell.

At his brother's prompting, Wang Zhonglei also trembled as he signed his name.

After the agreement was signed, Xu Li and others quickly checked it and affixed their seals.

At the same time as the agreement was exchanged, a pre-prepared announcement document was quickly sent to the Shenzhen Stock Exchange.

[Huayi's Announcement Regarding the Proposed Change of Control and Suspension of Trading of its Shares]

The announcement included the transfer of a total of 35% of the shares held by the Wang family, the transfer of 21.1% of the shares held by other minority shareholders, and the transfer of 11% of the shares held by Tencent and Alibaba.

This means that Changfeng Fund already holds more than 67.1% of the shares, gaining absolute control of Huayi Company.

Huayi's stock is suspended from trading due to a change in control and a major asset restructuring. The suspension is expected to last for 30 trading days, with a maximum of 90 trading days.

The news, once released, instantly tolled the death knell for Huayi as a business owned by the Wang family.

A trading halt means that the game in the secondary market is temporarily suspended.

This also signifies the final stage of the formal redistribution of Huayi among the three parties.

Shen Mo, Sun Zhonghuai, Zhang Qiang, and the others did not linger. After reaching a deal, they shook hands briefly with the Wang brothers and then left one after another.

As the last person left and the door closed gently, Wang Zhongjun collapsed into his chair.

Wang Zhonglei slumped onto the sofa, covering his face with his hands, his shoulders twitching slightly.

I don't know if it's anger, fear, or relief.