Chapter 187 Using Another's Strength to Fight Back
Chapter 187 Using Another's Strength to Fight Back
Late August 1989.
It has been only 36 hours since SA Entertainment made a $5 billion all-cash offer to acquire Columbia Pictures, sparking global discussion.
It's 3 a.m. Tokyo time.
Bunkyo District, deep underground of the Saionji Temple.
A heavy, lead-plated explosion-proof door completely isolated this encrypted communications room from the summer night outside. The ventilation ducts of the central air conditioning system ran continuously, supplying dehumidified cool air into the room, where a faint ozone odor emanated from electronic components.
In the four corners of the room, military-grade white noise generators were operating at a fixed frequency.
"Shhh—"
The monotonous and dense background noise filled the entire space, enough to tear apart any directional eavesdropping waves that tried to infiltrate from the outside.
Saionji Satsuki nestled in a large leather swivel chair.
She wore a soft, pure white silk nightgown, her long hair casually draped over her shoulders. The biological clock of her underage body was protesting strongly in this unnatural early morning hour.
Her eyelids felt unusually heavy, and her eyes welled up with a layer of physiological moisture. She couldn't help but open her mouth and let out a very slight yawn, then reached out and picked up the steaming glass of milk that the maid had just brought in from the table.
The warmth of the glass traveled through my palm, slightly dispelling the chill from the air conditioning.
On the corner of the table, the encrypted hands-free phone with its complicated knobs suddenly lit up in red.
The red indicator light flashed rapidly under the dim spotlight.
Satsuki got up, rubbed her eyes, and her gaze gradually cleared. The slight mist and moisture in her eyes evaporated completely in a second with absolute rationality.
She extended her finger and pressed the answer button.
"Boss."
Frank's hoarse and extremely tired voice came through the loudspeaker, penetrating the white noise in the communications room.
"Just an hour ago, SEC (Securities and Exchange Commission) Arthur Vance successfully persuaded a judge in the Southern District of New York. They bypassed the usual securities law procedures and directly invoked the special powers of CFIUS (Committee on National Security Review) to issue an emergency freeze order."
Frank paused for a moment on the other end, the sound of him swallowing being amplified by the microphone.
"The dozen or so offshore funds associated with SA Investment that were involved in the $5 billion offer have been completely frozen. The channels for funds to enter and leave the country have been completely blocked."
For any capital entity making an all-cash takeover bid, freezing its liquidity pool is tantamount to severing its carotid artery. If the $5 billion cash transaction cannot be completed on schedule, the acquiring party will face enormous penalties for breach of contract and a credit default in the international financial markets.
Arthur Vance's move was extremely precise and fatal. He exploited the political pressure created by the huge bait, and smoothly turned the tables on his opponent.
Should we turn the tables on them? The other party is quite a character.
Satsuki's fingers, holding the warm milk, were as steady as a rock, and not a single ripple appeared on the surface of the liquid.
However, if that's all there is to it, you can't turn things around.
Under the cover of white noise, the brain quickly switches into a model of interest deduction.
Washington's freeze order is an insurmountable physical wall.
But high walls can also be used to block the enemy's line of sight.
"Frank".
Satsuki's voice was clear and steady, traveling along the undersea fiber optic cable to Manhattan on the other side of the world.
"Have our New York legal team immediately file an appeal with the federal appeals court. Use every available legal procedure to request a hearing to examine each item on the basis for CFIUS's freeze."
She picked up the milk and took a small sip.
"I want you to drag this lawsuit on indefinitely."
"At the same time, SA Entertainment's legal department sent a formal letter to the board of directors of Columbia Pictures, stating that the acquisition was subject to force majeure political interference from the U.S. government based on 'national security,' and that the closing of the deal would be forced to be postponed. Until the legal process is completed, in accordance with the exclusive terms of the letter of intent we previously signed, they are not entitled to accept any third-party offers."
The bottom of the glass moved downwards and collided with the solid wood tabletop.
"Click".
A very soft, crisp sound.
"Strangle the Columbia board. Don't give them any opportunity to contact other buyers."
Frank on the other end of the phone gasped, then immediately replied, "Understood. The legal team will submit the documents as soon as the courthouse opens."
Satsuki hung up the call.
She leaned back in her leather chair, her gaze falling on the Tokyo coordinates on the world map on the table. The time difference had been created. While the Hollywood board was mired in a dilemma due to this "force majeure," she now held a trump card powerful enough to shake up the local giants.
Next, it will be Sony's turn to react.
……
The next day, at 10:00 AM.
Bunkyo Ward, Tokyo. The Saionji Main Family Residence.
Last night's light rain washed away the dust in the air. The morning sunlight pierced through the post-rain mist, shining obliquely on the shoji doors of the "Listening to the Rain Pavilion" tea room. The washi paper filtered out the harsh light, illuminating the interior with a bright and clear glow.
Deep in the courtyard.
"when--"
A bamboo deer-shaped drum, filled with mountain spring water, is struck heavily against a moss-covered stone bowl. The ethereal echo reverberates through the ancient courtyard.
The sliding door to the tea room was pushed open silently.
Accompanied by his secretary, Akio Morita, the founder of Sony Corporation, stepped into the tea room.
He was dressed in a traditional and elegant dark-colored Ōshima tsumugi kimono, his full head of silver hair meticulously combed. His steps were steady, his expression composed, showing no sign that his six months of hard work had been stolen.
As one of Japan's greatest industrialists after World War II, he possessed the strategic vision of a top predator. His ability to quickly recognize reality and find the optimal solution was an ingrained business instinct.
Shuichi Saionji, dressed in a dark gray montsuke haori hakama, knelt upright in the main seat.
"Morita-senpai, it's been a long time."
Xiu Yi bowed slightly, performing a perfectly standard welcoming greeting.
Akio Morita took his seat as a guest, placed his hands neatly on his knees, and nodded slightly in return.
"He's quite talkative."
His gaze passed over Shuichi's shoulder and landed behind him.
Saionji Satsuki changed into a dignified light blue old-fashioned aristocratic kimono, with a simple brocade sash tied around her waist. She knelt quietly behind her father, her eyes lowered, as if any business negotiations taking place in the room had nothing to do with her.
She held a bamboo whisk in both hands, gently and evenly whisking the matcha in the black Raku tea bowl in front of her.
"Swish, swish, swish."
The delicate sound of the tea whisk rubbing together echoed in the quiet room, while emerald green foam rose gracefully in the bowl.
The small talk and pleasantries were quickly skipped over.
"Shuichi-kun."
Akio Morita got straight to the point, his voice deep and resonant.
"SA Entertainment's offer is truly astonishing. Five billion US dollars in cash reserves is a testament to the Saionji family's current strength."
Instead of accusing the other party of blatant hijacking, he began to analyze the current situation from an extremely objective and calm, God-like perspective.
"but……"
Then, he changed the subject.
"After all, the Saionji family is a multinational corporation without the foundation of Hollywood producers' unions and screenwriters' unions. If it wants to independently absorb a huge content factory like Columbia Pictures, it will inevitably face serious challenges in adapting to the local environment. Without the underlying support of a hardware ecosystem, what it has bought with money is just an empty shell."
Morita Akio looked directly at Shuichi with his eyes like a torch.
"Mr. Seiji Tsutsumi of Seibu Department Store once tried to use capital to acquire cultural products, but his overseas hotel investments are still mired in difficulties. I think Mr. Shuichi would not want to repeat his mistakes."
Sony is willing to pay a premium of $200 million to take over SA Entertainment's acquisition offer.
The terms were presented directly and enticingly. A transfer fee of two hundred million dollars was enough to make any investment bank a fortune in just a few days.
Upon hearing this, Xiu Yi's lips curled up slightly, revealing a gentle smile.
This is the script that Satsuki instructed him to prepare beforehand during the meeting this morning.
He picked up the glass of water in front of him, took a small sip, and then put it down.
"Morita-senpai's analysis is very accurate."
Xiu Yi's voice was calm and steady as he slowly and methodically dissected the current business situation.
"SA Entertainment does lack a hardware ecosystem. But Sony seems to need Columbia more urgently than we do."
He raised his head, a sharp glint in his eyes.
"In the current home video recorder market, Sony's Betamax format is being completely suppressed by the VHS camp dominated by Panasonic. Panasonic has more home appliance channels and holds an absolute advantage in market share."
"The hardware war has reached a bottleneck. The key to victory is content. Whoever owns more film copyrights will be able to determine which format VCR consumers buy."
"Columbia Film Studios is Sony's last trump card in its fight against Panasonic's hardware blockade."
Shuichi placed his hands on the table.
"This is your inner demon, and also Sony's Achilles' heel."
Akio Morita's pupils contracted almost imperceptibly.
His fingers, which were resting on his knees, paused slightly.
His gaze once again passed over Shuichi and landed on the girl who was quietly pouring tea.
Shuichi's presentation was incredibly precise, his logic flawless. This incisive analysis of the situation was a stark contrast to Shuichi's usual steady and conservative style. Akio Morita astutely realized who the true "brain" controlling the pace of the negotiations was in this room.
Noticing Akio Morita's gaze, Satsuki put down the teapot.
She placed her hands on her knees, which were covered by her kimono, and raised her eyes to meet Akio Morita's gaze.
Anyway, rumors about her were already flying around in Japan's upper echelons, so she didn't need to hide anything.
In the gentlest and most respectful tone of a junior, she proposed a condition that left everyone present feeling suffocated.
"Uncle Morita."
Satsuki's voice was clear and crisp.
"SA Entertainment can withdraw from the acquisition of Columbia. Moreover, we can use the exclusive letter of intent we have already signed to assist Sony in the legal process and lower the final offer from Columbia's board of directors."
"We can help you save at least $500 million in premium costs."
Akio Morita listened quietly, showing no sign of delight at this windfall. He knew that freebies often come at the highest price.
"In exchange."
Satsuki continued.
"Besides Sony Entertainment's future 30% copyright distribution network in Asia, SA Group has another core objective."
She paused for a second.
"Sony Semiconductor Division is required to fully license the underlying patents of CCD (Charge-Coupled Device) image sensor technology to Saionji Information Systems (SIS) and sign the highest priority component supply agreement."
The air in the tea room froze instantly.
The deer outside the courtyard had fallen into a state of stillness because the water had not been filled for a long time.
Akio Morita tightened his grip on the rim of the teacup.
CCD image sensor. A core semiconductor technology that Sony has invested heavily in and poured countless hours of research into, barely managing to achieve commercial mass production. This is the absolute cornerstone of Sony's future global dominance in the digital camcorder and optical imaging fields.
The other party's intentions were completely exposed.
That shell company registered in the Cayman Islands, that five billion dollar all-cash offer that shook Wall Street. From the very beginning, the other party never intended to actually buy Columbia Pictures.
That enormous financial power was merely a giant curtain that obscured the sky.
All of this is so that, sitting at this tea table now, we can legally and reasonably use Columbia, a weakness that Sony cannot refuse, as leverage to forcibly tear off a piece of the most core hardware foundation from Sony.
Could it be that their real goal is Sony's technology? Is that what they're after?
A meticulously planned and elaborate scheme.
Faced with this blatant scheme that bordered on extortion, Akio Morita showed no sign of losing his composure; in fact, he even wore a polite, slight smile.
He gazed at the bowl of emerald green matcha in front of him, brewed by Satsuki himself. The surface of the tea was covered with fine, flawless foam.
Then, his gaze turned to the girl with the perfect posture.
He had to admit that the sheer audacity of this manipulation of Wall Street's rules of capitalist violence with the political maneuvering between Japanese zaibatsu instilled a slight tremor in him. But beyond that tremor lay a profound respect.
The fact that she could force Sony into this desperate situation where they had to choose between "losing their future content territory" and "ceding core hardware patents" makes this young lady of the Saionji family worthy of any respect.
Since Columbia is an indispensable strategic piece for Sony, the cost of sacrificing it is within an acceptable range.
Moreover, establishing a cooperative relationship with the Saionji family isn't necessarily a bad thing. In his view, the Saionji family's only daughter is destined for great things.
Akio Morita picked up the teacup, tilted his head back, and drank the warm matcha in one gulp.
The porcelain piece landed smoothly back on the table.
"Thump."
A dull thud echoed in the tea room.
"make a deal."
Akio Morita uttered two words in a low voice.
The deal is done.
The secretary stepped forward to help him up, and Akio Morita stood up, nodded slightly to Shuichi, and turned to leave the tea room. The sliding door slowly closed behind them.
The tea room returned to silence.
Xiu Yi picked up the water glass on the table and slowly moistened his throat.
"In exchange for an empty shell registered in the Cayman Islands, we obtained the most core hardware base of Sony's semiconductor division." Shuichi put down his water glass, the porcelain bottom making a soft sound as it touched the wood. His tone was relaxed and confident. "Morita-senpai, you paid quite a price for this cup of tea today."
Satsuki rinsed the bamboo whisk in her hand in clear water and gently placed it on the natural wood tea tray.
"Good medicine tastes bitter, Father." Satsuki raised her eyes to meet Shuichi's gaze, a gentle smile playing on her lips. "This tea may be bitter, but it can cure his 'heart disease' caused by Panasonic's hardware blockade. He will naturally drink it all willingly."
Looking at his daughter's calm and composed demeanor, a hint of tenderness appeared in Shuichi's eyes. He reached out and neatly stacked the several unused memos on the table for Satsuki.
"These past few days, you've been working non-stop, pulling several all-nighters, all to secure the freeze order from Washington." Shuichi's voice was deep, carrying a father's gentleness. "Once the court proceedings reach a stalemate and we've finished with what we're doing, we'll go to Karuizawa for a few days of rest."
My daughter is great in every way, except she works too hard. She's still such a young child, yet she works until late every night, sometimes even all night long. It breaks my heart to see her like this…
I feel like she hasn't grown much taller lately. Could it be because of her work?
"OK."
Satsuki stood up.
She walked with light steps to the open veranda of the tea room.
A gentle autumn breeze blew from the courtyard, fluttering the hem of her light blue kimono.
She extended her fair fingers and gently closed them in the air.
A withered pine needle that had fallen from the old pine tree in the courtyard landed steadily in her palm.
"Rest is also very important..."
The wind blew through the long corridor, stirring the iron wind chimes hanging under the eaves.
"jingle--"
The crisp sound of bells echoed through the empty, ancient mansion, its lingering notes lingering long afterward.
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