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Chapter 1106: Chapter 966 Valuation of 12 Billion US Dollars
This company was only responsible for research and development.
It had no factory.
It could support itself merely on the revenue from patent licensing, with an annual surplus of hundreds of millions of dollars, and the entire company had almost no debt and no shortage of money. The difficulty of proposing an acquisition for a company that didn’t lack funds could be imagined.
If it were anyone else,
it would be nearly impossible to acquire it. Even if they offered two to three times the price, the company might not even take a second glance, and without the approval of big clients and shareholders such as Apple, Qualcomm, and Samsung, they shouldn’t even think about it.
It was also because these world-class companies held stocks in ARM.
They would then feel secure in using its technology framework. However, if a Huaxia enterprise wanted to acquire it, these companies would surely become cautious and strongly oppose the acquisition at the shareholder meeting, ensuring the acquisition proposal wouldn’t pass even the initial review.
Not to mention the hurdle of the UK Government.
But as they say, where there’s a will, there’s a way.
Tang Qing was no ordinary person, and more importantly, the ultimate acquirer wasn’t himself. It was ERV, controlled by the fighters, an ’American home company.’ He and Ayman were at most a ’distraction’ and ’assist.’
And incidentally making a bit of ’easy money.’
ERV.
Its first quarterly financial report of the year showed a net profit of four hundred thirteen million dollars.
In the second quarter, profits broke through five hundred million dollars directly. The reason was that ERV’s other investment projects had kicked in, especially when, on top of its massive game user base, the gaming platform integrated a multi-person voice software similar to QT.
The moment this essential tool for forming teams appeared,
it immediately swept across the entire gaming platform. High-quality multi-person voice communication, whether for home or office use, made it popular among many people. On top of that, the second version provided video functionality.
It was in the moment video functionality was introduced,
ERV turned this software into a live broadcast software instantly, used for streaming games, singing, dancing, providing both entertainment and daily life features. Tang Qing had completely integrated future live-streaming content.
In just one month,
global registered users had surpassed fifty million, even more than "Warfire" and thanks to the fighters’ ’efforts,’ this number was still growing rapidly.
It wasn’t hard to understand.
"Warfire" was a game.
Live broadcast software was for popular entertainment, with a wider audience.
It left struggling MSN dumbfounded. ERV truly didn’t play by the rules. What was thought to be a competitor in instant messaging suddenly, like the ERV-started "Warfire," shifted towards the entertainment sector.
It was also the birth of this software,
that shot ERV’s valuation up continuously, from five billion dollars at the start of the year to now a hundred and twenty billion dollars, more than doubling, no wonder they say Internet Company valuations skyrocket.
Indeed.
From the beginning of ERV’s success,
all the major venture capitalists and corporate giants wanted a piece of the action as this Jumbo grew, Microsoft, Apple, Google, Samsung, IBM... nearly every company related to the Internet had made stock purchase requests.
Unfortunately,
ERV’s sole shareholder always refused resolutely.
But since last month, ERV had begun to hint at the intention to sell some shares while also leaking plans to go public, causing all the venture capitalists and securities brokers to get excited.
This was the bait thrown out by Tang Qing.
Others did not know that ERV’s true purpose was to obtain shares of ARM.
...
Indeed.
Tang Qing was preparing to introduce other capital into ERV, even planning on going public.
Just like ARM.
It wasn’t about having technology; you couldn’t do whatever you wanted without being widely accepted and irreplaceable. You had to discuss cooperation with others, and everything had to be negotiated. The idea of acting superior was simply impossible.
Scientists could develop another kind of technology architecture,
and there had already been significant progress.
But.
Why should anyone use your product?
Whoever it was, they always took a cautious approach to other people’s belongings.
This was also why ARM would share some of its stocks with the major corporations, not because it lacked money but to give everyone peace of mind in its use, without worrying about suddenly being choked.
Major Internet companies had the same consideration when financing.
Money was secondary.
The main thing was to gain the markets and connections behind each major international venture capital, like mobile phones; if all parts and technologies were developed and produced in-house, facing massive success wasn’t guaranteed.
Instead... it might not even be allowed into other countries.
Globalization.
It brought specialization as well as integration.
Self-sufficiency could work to an extent, but if taken too far, it violated trade rules, leading to the question: ’Why should I use your substitute product? Do you think you’re special?’
In the past, SoftBank acquired ARM thanks not only to its extensive resources in Internet hardware and software but also because SoftBank itself had the nod from numerous international giants. It was a kind of ’internal resource integration.’
Therefore,
ERV couldn’t just innovate in solitude. It needed ’communication’ with the outside world.
The fighters only needed to maintain absolute controlling rights. Tang Qing’s goal was to let ERV’s market value breakthrough a hundred billion dollars by the end of next year through a series of financing and going public plans.
In Tang Qing’s plan,
ERV was to be a powerful presence deeply controlling the global Internet. By the end of the year 2010, the fighters would achieve a phased target—becoming the Internet company with the highest market value in the world.
...
In the living room,
"I feel like your project is a lot less reliable than my oil fields," Ayman said with a wry smile, looking at Tang Qing. He didn’t know if Tang Qing was genuinely naive or just pretending; such a company was almost impossible to acquire, even with his help.
"You’ve got to have dreams. What if they come true?" Tang Qing smiled.
Ayman: "..."
Tang Qing’s logic sounded reasonable, yet somehow it felt flawed.
"Do you really intend to do this?" Ayman asked.
"Of course," Tang Qing nodded.
"How?"
"Straight up make an acquisition proposal, while also purchasing their circulating stocks on Nasdaq. I don’t think it will cost much, and then we’ll see if there are any other private shares available for purchase. That’s when we’ll need to use the name of the Saudi royal family," Tang Qing said, half-smiling at Ayman.
Teasing this guy
was quite fun.
"I... Um... The Saudi royal family’s name doesn’t carry that much weight," Ayman professed, his face turning red with embarrassment. The Saudi royal family wasn’t the United States Government after all.
Tang Qing: "..."
You were just saying how no one dares to scheme against the Saudi royal family, right?
That confidence
sure collapsed quickly.
"Let’s give it a try; what’s there to lose? Any non-stock market shares you manage to buy that don’t exceed fifty percent of its current market value, I will purchase at one hundred and fifty percent of the price," Tang Qing suggested again.
After a moment of consideration,
Ayman lifted his head and said, "Alright, I’ll give it a try."
With Tang Qing as the backstop,
it was worth a shot. If it didn’t succeed, he stood to lose nothing. If it did, he might even make a profit.
