Chapter 1228： Fighting

New Global's IPO underwriters include six or seven banks, all of which are world-class financial giants.

08's rake... It's really not enough.

The reason why everyone has a good relationship with New Global and wants to undertake the IPO operation of New Global is because it is profitable, and it is a huge profit!

It is definitely not comparable to the dividend of 08.

Wall Street investment banks are actually both athletes and referees, using this privilege to make big money.

For example, when an agent in Hollywood seeks remuneration for its actors, all the remuneration goes to the actor, and the agent only takes about 10 percent of the money. If it is a superstar, the rake will be lower.

If the actor asked for a salary of 10 million US dollars, the agent used his ability and connections to win a salary of 20 million US dollars. So can the $10 million difference fall into the broker's pocket?

Of course not!

The $20 million belongs to the actors, and the agent still can only take a cut.

This is the intermediary.

Underwriters are essentially intermediaries.

But the big investment banks obviously don't have the professional ethics of Hollywood agents.

Assuming that New Global IPOs at an issue price of $200, then the 200 million shares of New Global can earn $40 billion.

If during the IPO process, the shares of New Universal were sought after and loved by investors, and the stock price was raised to US$300, where did the US$100 difference go?

A difference of $100 with a size of 200 million shares is $20 billion!

It is an extraordinary sum of money!

Will this difference go into New Universal's account?

Won't!

New Global will only get $200 of the issue price, and subsequent high prices have nothing to do with New Global. The $100 that has been raised will fall into the hands of investors and investment banks that have fallen behind.

What's more, big investment banks play the game of being both buyers and sellers.

For example, New Universal authorized an underwriting volume of 50 million shares to Citi Pictures. Citibank itself is the largest investment institution. If you see high-quality stocks, you can buy them yourself! Internal delivery, fast and convenient!

Therefore, this will make it difficult for investors to buy a large number of stocks from Citibank, because Citibank bought it first!

This will indirectly lead to fewer new global stocks circulating in the market, and the stock price will rise due to the availability of rare goods. Citibank took the opportunity to sell shares and make a lot of money.

Compared with the 08 commission, this is the way Wall Street investment banks make money.

So it is clear.

On the surface, the higher the issue price of New Global, the higher the total amount of IPO financing, the more bonuses the investment banks get, and the more they earn.

Actually quite the opposite.

The lower the issue price is, the more favorable it will be for investment banks to capture profits in the IPO process in the future!

Because once the service breaks, the investment banks' speculative behavior will cause them to suffer huge losses.

This is the process of a game.

New Universal wants to raise the issue price, and the underwriters want to lower the issue price.

Listing is a financial act, and New Global must rely on the major investment banks on Wall Street.

There are still a few big investment banks that have not participated in the New Global IPO, and the investment banks that have already cooperated do not dare to push New Global too much. In case Tang En was annoyed, he would break up the table and find another investment bank to cooperate, then he would not be able to earn a penny.

Therefore, whether it is New Global or investment banks, in the negotiation of the issue price, we must strive for it, and we must be restrained, and we must not squeeze the other party too hard.

To be profitable, everyone should make money together.

At this time, we can't eat alone like New Global is in Hollywood, because this is a cross-industry competition. New Global has no energy in the financial field, and must rely on Wall Street to share benefits.

Reliance is reliance, but what should be achieved must be fought hard.

New Global earns more, and Wall Street earns less. New Global earns less, and Wall Street earns more.

The wrestling in this will be very hard.

Dunn is holding this highest-level financial conference today, and the only purpose is to unify thoughts!

At this critical moment, no one can break the chain for me!

No matter who is lobbying behind you, no matter how important your connections are, you can't back down at this time!

Grit your teeth and persevere!

The $408 issue price is a no-brainer.

A $300 launch price is also unlikely.

But Dunn made a request, a guarantee of $250!

The issue price of $250 is just enough to raise the market value of New Global to a height of $300 billion.

This is the top secret of New Universal.

No matter how hard the Wall Street side is, this bottom line cannot be breached!

Hearing Dunn say that the bottom line of the issue price is $250, which made many people at the venue secretly relieved.

They were afraid that Dunn really offered an issue price of $300,408!

If New Universal does this, Wall Street really can't do anything about it.

But the next thing can be imagined, the IPO will definitely fail, and the stock will definitely be unsalable, and then it will be bad for Wall Street.

The cost of beating Wall Street is too great.

The most typical is Elon Musk.

In his previous life, he repeatedly opposed Wall Street, and then Tesla, which he managed, suffered frequent short-selling crises, and its stock price plummeted frequently. Several major investment banks jointly downgraded their ratings and lowered their expected stock prices, which led to the collapse of the market. For this reason, Elon Musk shed tears on TV several times and denounced the despicability of short sellers. What's the use?

Financial markets are in the hands of Wall Street.

This is other people's territory, if you don't obey, you will be beaten.

Never turn against Wall Street for short-term gain.

Dunn naturally understood this truth.

Otherwise, he would not have withdrawn from the stock market after taking advantage of the "911" incident. In fact, he also knows too many short signals about futures, oil, and subprime real estate.

But he can no longer operate.

This is equivalent to stealing money from Wall Street, again and again.

The relationship with the big banks on Wall Street must not deteriorate.

……

The next day, Dunn received a faxed letter from Citigroup, the general counsel of the new global listing.

The content of the letter is high-sounding, claiming that "because the second quarter financial statements of New Global are particularly beautiful, market expectations have greatly increased. After research by several chief economists from investment banks such as Citi, Goldman Sachs, and Morgan Stanley, the decision has been greatly improved. Raised the expected launch price of the new Universal! To $196!"

The content of the letter is very long, and the various reasons for the investment bank to give the issue price of $196 are also marked below.

One of the most important is to lower the price-earnings ratio.

Quite simply, the issue price is the opportunity of the net profit per share and the price-earnings ratio, which is a linear relationship.

Net profit is the exact data. If you want to lower the issue price, you can only lower the price-earnings ratio.

The reasons given are also very strong.

New Universal's first-quarter profit was only $1.3 billion, but its second-quarter profit surged by $2.7 billion to $4 billion!

Why?

The most fundamental reason is that starting from the second quarter, New Universal has opened up a new business.

Dolby DVD players are on sale!

This highly compatible DVD player that can play v, hv and blu-ray formats is still the most advanced DVD player in the world so far, and it sells for a whopping $1,299!

Since its launch in April, it has sold more than 3.28 million units worldwide, generating US$42.6 billion in revenue for New Universal, with a gross profit of US$3 billion!

Almost half of New Universal's $4 billion net profit in the second quarter came from Dolby DVD players!

There is no technical difficulty in such a thing as a DVD player.

The reason why Dolby DVD players can make so much money in a short period of time is because there is currently only this highly compatible DVD player in the world, which monopolizes the market. After a period of time, other manufacturers have also produced similar products, and the sales of Dolby DVD players will definitely decline significantly.

This is one of them.

Second, Dolby DVD players are hardware products, and they are not high-tech hardware products like Cisco or Qualcomm, but very common functional hardware products. This type of hardware business has a lower price-earnings ratio, usually between 1012.

The low price-to-earnings ratio of the Dolby DVD player business with such a high weight ratio will greatly reduce the overall price-to-earnings ratio of New Universal Group.

In the past, investment banks gave New Global a price-earnings ratio of 3035.

Now it has changed, it is between 1520.

has shrunk twice.

According to such a price-earnings ratio, it is normal to give an issue price of $196.

Because the net profit is certain, the issue price dispute is essentially the price-earnings ratio dispute.

Of course Dunn would not be satisfied with the answer given by the investment banks.

The Dolby DVD player business has low potential and low leverage, which is no problem.

However, in Wall Street's assessment, they only saw the Dolby DVD player business, but did not see the two trump cards of Facebook and Netflix!

For these two Internet companies, the leverage of 500 times is not too much!

Wall Street is a typical small zoom!

In the future, Netflix will not be separated from New Universal, and Facebook will definitely be separated, which will be a giant.

Now, the money-burning attribute of cannot be split. It is too strong.

Once split, New Global and Facebook will become two companies, and New Global will have to use all resources to support Facebook regardless of costs and consequences.

At that time, in order to develop independently, Facebook will definitely look for other foreign aid, and even give up a lot of shares to attract strong aid. This will in turn further dilute the shares.

The best result is to go public now and use the power of New Global to help Facebook develop.

After Facebook becomes bigger and stronger, it will be split and listed separately.

Such a potential trump card is hidden inside New Global. In Dunn's opinion, the current price-earnings ratio assessment of New Global is not too much between 3035.

The price-earnings ratio of 1520 proposed by Wall Street is really ridiculous!

"Return to the past and say that the internal issue price assessment of New Universal is $300,408, even the minimum standard of $300, is very different from the $196 issue price assessment they made. With respect to Wall Street, I am willing to take a step back. , down...$4! $296!"

Games, seesaws, and bargaining.

Tang En looked peaceful and peaceful.

It seems that he intends to fight against the big investment banks on Wall Street.