The "double high" phenomenon of mergers and acquisitions in the film and television industry still remains. Many M & A companies have promised to break the contract

the film and television companies that are "good at dancing" in the capital market seem to follow the rule of "high premium and high performance commitment" when merging star companies.

original title: from the bottom, the film and television industry merges the grey rule of "double-high" arbitrage

the film and television companies that "dance well with long sleeves" in the capital market seem to follow the rule of "high premium and high performance commitment" when merging star companies.

following Zhao Wei's abandonment of Wanjia Culture, on the evening of April 18, Great Wall Film and Television released a restructuring plan to acquire Jiang Wenli's family company for the premiere era, while a reporter from Changjiang Business Daily found that it was almost the same as all artist companies were acquired. The premium rate of the merger is as high as 3168.99%, and the performance commitment growth rate is about 30%.

however, listed companies frequently make mergers and acquisitions with high premium and high performance, and the "sequelae" have emerged while realizing the rapid expansion of the company. Last year, film and television giant Huayi Brothers acquired Feng Xiaogang's Zhejiang Dongyang Latin American Media Co., Ltd., and its promised performance failed to meet the standard, with a completion rate of only 55%.

however, even so, a reporter from the Yangtze River Business Daily found that under the "double-high" arbitrage rule, even if the performance is not up to standard, the compensation paid by star artists is far lower than the premium.

what is worth paying attention to is that mergers and acquisitions in the film and television industry have ushered in strong supervision. Since the beginning of this year, Storm Group, Tangde Film and Television, Lugang Culture and other companies have terminated mergers and acquisitions, Leeco, Oriental Network and other companies may delay or adjust the restructuring plan.

"the film and television industry is an extremely light asset, the core is mostly stars, and the valuation consideration is unreasonable." Shen Meng, executive director of Xiangsong Capital, told reporters on April 20 that "secret room transactions" by a small number of people in the film and television industry may not happen again with increased inquiries from regulators.

< strong > Great Wall Movie and TV mergers and acquisitions at a premium, Jiang Wenli's family company makes a profit of 792 million < / strong >

Zhao Wei's abandonment of Wanjia has just subsided, and mergers and acquisitions in the film and television industry have once again attracted attention. this time, Jiang Wenli is standing in the spotlight.

on April 18, Great Wall released a major asset restructuring plan to buy the premiere era, while the major shareholders behind the premiere era were Gu Changwei and Jiang Wenli.

the opinions table of securities firms and law firms released by Great Wall Film and Television for the verification of the restructuring plan shows that the premiere was established on October 26, 2010, with a registered capital of 10 million yuan. At that time, the main shareholders were Gu Changwei (1.213 million yuan), Jiang Wenli (840000 yuan), Jiang Wenjuan (140000) and her daughter Ma Sichun (466000), who held more than 25 per cent of the company.

after several rounds of equity conversion, by December last year, Jiang Wenli's family directly held 33.59% of the premiere shares and 72% of happy media, which held 40.84% of the premiere era. At that time, the proposed acquisition consideration in the premiere era was 1.35 billion yuan, compared with the book value of 42.01 million yuan of assets, the transaction valuation premium of up to 31 times. It is this high premium that Great Wall Film and Television received a restructuring inquiry letter issued by the Shenzhen Stock Exchange. Great Wall Film and Television responded by suspending trading for half a year and throwing out a restructuring plan and issuing an acquisition announcement on April 18.

the announcement shows that the company plans to issue 87.83 million shares at 12.30 yuan per share and pay 270 million yuan in cash for a total of 1.35 billion yuan to buy the 100% stake in the premiere era held by willing Media, Han Wei and Jiang Wenli. If the deal is completed, Great Wall Film and Television will pay 160 million and 110 million consideration for Gu Changwei and Jiang Wenli respectively. Concerted actors Ma Sichun and Jiang Wenjuan will also get a trading consideration of 63 million and 19 million.

with this transaction, Jiang Wenli and her family will receive a cash consideration of 170 million yuan (happy media will get a cash consideration of 236 million yuan), as well as a transaction consideration of 55.3259 million shares of Great Wall Film and Television. If calculated on the basis of the closing price of 11.25 yuan on April 21, the market capitalization is 622 million, and if taken together, Jiang Wenli's family will make 792 million yuan in gold. Gu Changwei and his actors will hold 76.8496 million shares of Great Wall Film and Television, with a shareholding ratio of 11.28%, making it the second largest shareholder of Great Wall Film and Television.

while the premium is over 30 times, the Jiang Wenli family has also made a high performance promise that the net profit from 2017 to 2019 will not be less than 90 million, 125 million and 159 million. From 2014 to the first 10 months of 2016, the turnover at the premiere was 250100 yuan, 4.9098 million yuan and 35.56 million yuan.

< strong > since last year, the value of 77 M & A transactions has reached 113.218 billion < / strong >

Film and TV mergers and acquisitions, which began in 2013, are still suffering from a "high fever".

"Wanjia Culture, Oriental Network, Storm Group, Tangde Film and Television …..." On April 21, a person from a securities firm who was concerned about mergers and acquisitions in the film and television industry listed the cases of mergers and acquisitions in the film and television industry to a reporter from the Yangtze River Business Daily. According to its statistics, in the first quarter of this year, A-share companies initiated 12 mergers and acquisitions of film and television entertainment assets, with a transaction value of 3.8 billion yuan.

"the film and television industry has a strong momentum of development, and some listed companies have entered across the border." The person said that the easiest way is to acquire some star artists' companies, many star companies do not actually operate, belong to shell companies, it is very convenient to operate.

in fact, mergers and acquisitions in the film and television industry have been hot since last year. A total of 77 mergers and acquisitions have taken place in A-shares so far last year, down from 2015, but the transaction value reached 113.218 billion, a sharp increase over the same period last year, according to Wind.

of the 77 mergers and acquisitions mentioned above, 5 are still in the stage of transfer intention, 15 are in the preliminary stage of the board of directors, 4 have been approved by the shareholders' meeting, and 20 have signed transfer agreements. Oriental Network's pre-plan for the acquisition of Jiabo Culture, Huahua Culture and Yuanchun Media has been suspended by the CSRC. Of the 77 mergers and acquisitions, 19 have been completed, with a transaction value of 12.611 billion yuan and 9 failures.

this year, A-share companies have issued a total of 36 announcements of mergers and acquisitions of film and television entertainment, including Wanjia Culture, Xinke Materials, Jinlihua Power, Cloud Media, Contemporary Oriental, Leeco, and other companies.

what is worth paying attention to is that mergers and acquisitions in the film and television industry, high valuation and high performance commitment have always existed.

for example, Xinke material announced on February 14 this year that Xi'an Mengzhou Film and Television Culture Communication Co., Ltd., a wholly-owned subsidiary, plans to acquire a 875 million stake in Fantasy Factory. The data show that the underlying asset premium is 13 times. The performance commitment given by Fantasy Factory is that the net profit from 2017 to 2019 will not be less than 100 million yuan, 130 million yuan and 169 million yuan.

< strong > "sequelae" broke out, and a number of M & A film and television companies promised to break their appointments < / strong >

after benefiting from frequent mergers and acquisitions, Huayi Brothers has grown into a leader in the film and television industry.

A reporter from Changjiang Business Daily found that in 2013, Huayi Brothers paid 252 million for a 70% stake in Zhejiang Changsheng Film and Television owned by Zhang Guolin. at that time, Zhejiang Changsheng was established less than four months ago, with a registered capital of 10 million and no actual operation. In 2015, Huayi Brothers bought another 70% stake in Zhejiang Dongyang Haohan Film and Television Entertainment Company for 756 million yuan. The shareholders include Li Chen, Feng Shaofeng,

Angelababy, Zheng Kai, du Chun and Chen he. A few days later, he spent another 1.05 billion yuan to acquire a 70 per cent stake in Feng Xiaogang's Zhejiang Dongyang Latin American company. Dongyang vast, Dongyang Latin America is not established for a long time, there is no actual operation, mergers and acquisitions have high premium, high performance commitment.

now, the "sequelae" of the above-mentioned acquisitions are emerging. According to the 2016 annual report, Zhejiang Changsheng and Dongyang had a net profit of 25.0013 million and 101 million, and a performance completion rate of 66.15% and 97.98%, both of which failed to meet the standards. according to the agreement, the two companies need to compensate Huayi Brothers 14.8785 million yuan.

Feng Xiaogang's performance in Dongyang Latin America is also not up to standard. Last year, its net profit was 55.1139 million yuan, while its promised net profit was 100 million yuan.

however, according to Huayi Brothers' public statement, Dongyang Latin America's performance in 2015 and 2016 is counted together, so that Dongyang Latin America's performance commitment has been fulfilled.

compared with the above three target companies, Yinhan Technology acquired by Huayi Brothers has a promised performance completion rate of only 63.5%.

in fact, it is not only Huayi Brothers, but also many film and television companies that have acquired mergers and acquisitions that fail to meet the promised performance standards. Last year, Tianrun several entertainment, new culture, god entertainment, light media and other companies in the process of mergers and acquisitions of high-performance promises are not ideal.

Last year, Avazu Inc and Shanghai Mai Orange, the two target companies of God Entertainment, needed to deduct a total non-profit of not less than 177 million yuan. in fact, the combined completion rate of the two companies was only 76.23 percent, and they needed to compensate 42.0315 million yuan. Tianrun several entertainment acquisition of the game company Dianle, deducting the non-attributive mother net profit of 77.7273 million yuan, lower than the promised net profit of 3.5227 million yuan.

although the promised performance is not satisfactory, mergers and acquisitions in the film and television industry still have a high fever.

A reporter from the Yangtze River Business Daily found that there is a "double-high" arbitrage law hidden in mergers and acquisitions in the film and television industry, that is, high premium mergers and acquisitions and high performance commitments. once the performance does not meet the standard, the compensation paid is also far lower than the premium. Stars can succeed in arbitrage at a high premium.

people in the industry said that in mergers and acquisitions of the film and television industry, the real purpose of buyers buying underlying assets at high prices is to "kidnap" star artists through gambling agreements, and take a fancy to star resources. In turn, star assets have made huge profits by being acquired at a high premium. Even if the promised performance can not be fulfilled and compensation needs to be paid, the compensation paid is nothing compared to the premium of ten or dozens of times.

what is worth paying attention to is that the M & An of the film and television industry has ushered in strong supervision. Since the beginning of this year, Storm Group, Tangde Film and Television, Lugang Culture and other companies have terminated mergers and acquisitions, Leeco, Oriental Network and other companies may delay or adjust the restructuring plan.

Shen Meng said that regulators have stepped up inquiry and supervision, and under the principle of strengthening the letter, the "secret room transactions" of a small number of people in the film and television industry may not happen again.

Edit: nancy