Chapter 179 Counter-acquisition and shock
In 2005, a high-profile takeover war broke out in China's business community.

That is the Shanda acquisition of Sina.

On February 2.3 of this year, Shanda suddenly announced that it had acquired % of Sina Corporation's shares through secondary market transactions at a cost of US$ million.

And in accordance with relevant laws and regulations of the United States, Shanda has submitted equity income documents to the United States Securities and Exchange Commission.

As the news came out, the stock prices of both companies rose.

In China, it also became a sensational news in the mainland business community.

One is the world's largest Chinese portal website, and the other is the country's largest gaming company.

The collision between these two companies attracted a lot of attention.

I don’t know if Shanda and Sina failed to reach an agreement, but three days later, Sina explicitly rejected Shanda’s acquisition.

Not only that, Sina also invited Morgan Stanley as an anti-takeover consultant to implement a poison pill plan.

The poison pill plan is an anti-takeover measure for a company. The company sets a "poison pill" trigger point. When an external acquirer holds more than a set proportion of the company's shares, the poison pill plan officially takes effect, and a large number of new shares are issued at a low price to dilute the equity and resist hostile takeovers.

Shanda announced that it holds a total of 19.5% of Sina's shares, making it Sina's largest shareholder.

In the documents submitted to the U.S. Securities and Exchange Commission, Shanda also admitted that this was a strategic investment aimed at "seeking to obtain or influence control of Sina."

After Sina implements the poison pill plan, if Shanda continues to increase its holdings of Sina shares to a ratio exceeding 20%, the poison pill trigger point will be reached.

Other shareholders can all get a stock option, which they can use to purchase Sina shares at half the price at the time, greatly diluting Shanda's shares.

This made Shanda cautious, probably because the preparations were too hasty. Shanda's acquisition consultant Goldman Sachs also did not have a good solution for this.

But Chen Tianqiao has made such a great determination that he will definitely not give up so easily.

During this period of time, Shanda has been struggling with Sina, but the results have not been very good.

Therefore, Chen Tianqiao prepared to find another way to see if he could acquire the shares held by Sina shareholders and forcibly control Shanda with more shares.

After looking through the list of Sina shareholders, Chen Tianqiao immediately set his sights on Liu Zhou.

Sina's shareholding is very loose; among its top ten investment institutions and top ten investors, only one holds more than 10 percent of the shares, and only two hold more than 5 percent.

One is the former largest shareholder of Sina, Soitong Group, which previously held a 9.3 percent stake.

However, after Sina's stock price recovered, Soitong Group cashed out part of its shares and became the second largest shareholder.

The other is Liu Zhou's Zhoushan Capital, who bought Sina's stock at the bottom during the Internet bubble and acquired 8.7% of the shares.

At the end of last year, Liu Zhou cashed out his Sohu shares and acquired Golden Harvest, and still had 200 million yuan left, all of which he bought Sina shares.

At this time, Zhoushan Capital already held 10.5% of Sina shares.

At that time, Liu Zhou's action also aroused the vigilance of Sina's board of directors and other shareholders.

It was not until Liu Zhou stated to them that his investment was only financial and he had no intention of joining the board of directors that they let down their guard.

This is also what Chen Tianqiao values ​​most.

Since Liu Zhou's investment is only financial and he obviously doesn't have any ideas about Sina like other shareholders, as long as there is enough money, the shares can be traded.

Afterwards, Chen Tianqiao also conducted a detailed investigation on Liu Zhou and discovered that Zhoushan Literature, which Shanda wanted to acquire, was actually Liu Zhou's industry.

This struck him as a complete coincidence.

So this time he came to the United States in person to meet Liu Zhou, wanting to take over Zhoushan Literature and Sina shares from him.

However, he did not expect that he would start off well. He first ran into an obstacle with Zhou Shan Wenxue, whom he thought would be easier to conquer.

At the same time, it also made him feel that Liu Zhou was not just a simple person with good luck.

That’s right, in Chen Tianqiao’s opinion, Liu Zhou’s previous bottom-fishing was mostly due to luck.

Liu Zhou was not surprised at all when he heard that Chen Tianqiao wanted to buy his shares in Sina.

As the largest shareholder of Sina, although he did not join the board of directors to avoid suspicion, how could he not know about such a major event as Sina's acquisition?

Liu Zhou still holds the rights to purchase Sina's newly issued shares at half price.

Shanda's surprise attack on Sina also indirectly helped Liu Zhou.

In order to prevent Shanda from defeating each shareholder one by one, Sina's board of directors naturally allowed Liu Zhou to join the board of directors.

So now Liu Zhou has another title, that is, the new director of Sina Group.

When Chen Tianqiao invited him, Liu Zhou knew that he was probably coming for the Sina stocks he held.

But no one expected that he also wanted to take over Zhoushan Capital in his hands.

Shanda Network is now indeed wealthy and powerful.

But Liu Zhou himself was planning to take advantage of the situation, so how could he possibly sell Sina shares to him?

"Mr. Chen, you are a little late. You should have come to see me earlier. I have signed a concerted action agreement with some other shareholders of Sina.

I can’t even handle my own shares right now, let alone sell them to you.”

Liu Zhou didn't give Chen Tianqiao any illusions and directly blocked what he was about to say next.

"Mr. Liu, when did this happen? How come I didn't know about it?" "It was in March when I joined the Sina board of directors."

After hearing what Liu Zhou said, Chen Tianqiao couldn't help but fall silent.

It seems that Sina has made up its mind not to let Shanda take over.

At this moment, Chen Tianqiao felt a sense of loss for the first time.

Acquiring shares from Sina shareholders and expanding Shanda's shareholding ratio is Shanda's only chance to take over Sina at present.

But unexpectedly, they had already signed a joint action agreement.

Since Liu Zhou signed, it was obvious that the other shareholders must have signed as well, and Chen Tianqiao's plan would have completely failed.

In other words, Shanda’s plan to acquire Sina also failed.

Liu Zhou looked at Chen Tianqiao who suddenly fell silent, and couldn't help but sigh in his heart.

To be honest, just as Golden Harvest is a very good fit for Liu Zhou, Sina is also a very good fit for Shanda.

Although Shanda has achieved great success in the gaming industry, its business operations are too single-minded.

According to the financial report released by Shanda last year, its game revenue accounted for more than 90% of Shanda’s total revenue, and its ability to resist risks was extremely poor.

Shanda's acquisition of Sina is also to meet the needs of diversified operations and improve its ability to resist risks.

In addition, Shanda and Sina are also very complementary, not only in business but also in user groups.

Shanda's main business is games, while Sina is the industry leader in wireless value-added services and also the number one in news portals.

Add to that some other businesses like online advertising, search engines, instant messaging, and email, and it can be said that if Shanda acquires Sina and integrates them together, it can instantly become an industry giant.

Not only that, these businesses of Sina also play a very complementary role in Chen Tianqiao's creation of an online Disney.

In terms of user groups, Shanda mainly targets young people, while Sina mainly targets young and middle-aged white-collar workers.

If Shanda acquires Sina, the entire Internet user group will be their users.

But the imagination is beautiful, and the reality is very skinny.

Whether in the past or now, Shanda’s acquisition of Sina has ended in failure.

But Shanda did not lose out either. After the failed acquisition, they made a fortune from the Sina shares they held.

Historically, after Shanda's failed acquisition, it began to sell Sina shares in the secondary market from October 2005 and cashed in a large amount of cash.

Because Sina’s financial report this year is also very good, Sina’s stock price has been rising.

The amount of money Shanda cashed out was almost double his investment.

But in this life, Liu Zhou doesn't want Shanda to cash out its shares slowly.

Shanda is interested in the stocks it holds, and Liu Zhou is actually also interested in Sina stocks held by Shanda.

After Sina adopted the poison pill plan and several shareholders signed a concerted action agreement, Liu Zhou knew that Shanda's acquisition would not be successful.

After a while, Liu Zhou saw that Chen Tianqiao's expression had returned to normal, and then said:
"Mr. Chen, there is nothing we can do about this. Most of the time, things in life go wrong. In fact, in my opinion, even if Shanda focuses on games, it can still develop very well."

“You are right, but my goal is to build Shanda into an online Disney, and games alone are far from enough.

Besides, online games have a bad reputation now, and I have been scolded by parents for the past two years, which makes me feel a little stressed." Chen Tianqiao said with a wry smile.

Online games have a very bad reputation nowadays, and almost all parents are against them.

Even extreme incidents occurred at this year's West Lake Sword Conference.

A parent was standing at the gate of the West Lake Sword Conference venue. Although his child was only slightly burned thanks to timely rescue, Chen Tianqiao still broke out in a cold sweat and Shanda was once again caught in a whirlpool of public opinion.

"Since the acquisition of Sina failed, what will Mr. Chen do next?"

"What else can I do? Since I have failed, I will do it myself. One day I will build Shanda into what I imagined."

Looking at Chen Tianqiao who seemed to have regained his confidence, Liu Zhou said with a smile:

"I heard that Mr. Chen is currently investing heavily in the development of a Shanda box. Have you considered the market for this box?"

"Of course we have considered that the public can play games, read online articles, and obtain various entertainment content on the Internet through television, which will definitely be popular among the public."

Liu Zhou looked at Chen Tianqiao's confident and ambitious look and decided not to persuade him anymore.

For people with strong will like them, once they have decided on something, it is difficult to pull them back before they hit a wall.

"Mr. Chen, what are you going to do with the Shanda shares you have?"

"Of course, we will sell them slowly. These stocks have taken up most of Shanda's funds."

At this time, Liu Zhou looked at Chen Tianqiao with sharp eyes and said:

"Mr. Chen, how about you sell me your Sina shares?"

Hearing Liu Zhou's words, Chen Tianqiao couldn't help but widen his eyes and looked at him in shock.

(End of this chapter)