I am Hollywood

[Chapter 1186: Ambition]

As the former CEO of Firefly Group's ESPN, Steve Bernstein witnessed the rise of Firefly Group and the entire Firefly system firsthand. Therefore, he had no doubt about the ambition Eric expressed, one that was comparable to General Electric's.

In reality, General Electric had already reached its peak, and further large-scale expansion was unlikely. With the retirement of the legendary leader Jack Welch, the future of this industrial giant was more likely to decline after such heights.

However, the Firefly system was different. Eric was in his prime, with enough time and energy to lead this conglomerate's continued expansion.

Moreover, when it came to reported assets, the Firefly system had already surpassed General Electric.

In the upcoming years, as long as the company could successfully manage the severe bubbles embedded in its new technology sector and further consolidate its foundation in the core fields of networking and media, the Firefly system could truly grow into a megacorporation with significant influence over the American economy.

Although many believed the Firefly system had already hit a bottleneck in the new technology and media sectors, with future expansion increasingly limited by U.S. antitrust laws and other competitive capital forces, Steve Bernstein keenly noted that most of the core enterprises in the Firefly system were still based domestically.

This meant that the Firefly system still had vast potential for global development.

Taking Nokia as a successful overseas investment case, it was clear that Eric was not lacking in vision for global expansion, nor did the Firefly system lack the capital strength for it.

Thinking of all this, Steve Bernstein found himself needing to address the pressing issue at hand.

Over the past month or so, Firefly Group had been quietly accumulating shares of Comcast.

Initially, Comcast's senior management felt excited about Firefly Group's buying spree, as Comcast's stock price had already risen over 17% during this time.

However, once Firefly Group submitted their filing to the SEC declaring they held 6.5% of Comcast, Comcast's board and management suddenly woke up. When Howard Glassman, a finance columnist for The Washington Post, published another analytical article about the Firefly system, Firefly Group's intent to acquire Comcast became glaringly obvious.

In fact, from the moment Firefly Group began purchasing Comcast shares, Steve Bernstein had already had a hunch about the potential buyer. After all, while it might not have originally been considered a core part of the Firefly system, his involvement had given him deep insight into the company's expansion strategies.

However, Steve Bernstein's judgments were merely guesses. As much as he wanted to call up people like Katzenberg to test the waters, he knew that he had distanced himself from the Firefly system and that Katzenberg and others would not disclose any details to him.

Deep down, Steve Bernstein did not harbor much wariness towards the Firefly system, and he hadn't even reported his suspicions to Comcast's controllers, the Roberts family.

Now, not only did Firefly Group hold 6.5% of Comcast's shares, but they were also continuing to buy up more. Their intent to merge with Comcast was unmistakable.

Since basic operators fell within the realm of capital-intensive industries, where each step of growth required significant cash support, the Roberts family's ownership had dwindled to just 3.1% over the years due to continuous financing dilution.

While the Roberts family had up to 33% voting power through authorization agreements, they knew that if Firefly Group offered an appropriate price, the voting power they held would be insufficient to fend off Firefly Group's acquisition.

Realizing the crisis, the Roberts family summoned the board and senior management for some deliberation before quickly dispatching Steve Bernstein.

...

In the spacious IMAX auditorium, after a casual chat, Steve Bernstein shifted to the matter at hand, saying, "Eric, do you know how Berkshire became the major shareholder of ABC?"

Eric shook his head; he understood perfectly why Steve Bernstein was there today but chose not to say anything, simply smiling and waiting for him to continue.

Steve Bernstein didn't wait for Eric to respond and continued, "Buffett has always been very interested in the media industry. In 1985, when Tom Murphy expressed intentions to acquire ABC, Berkshire made a $500 million investment in Capital Cities, becoming the largest shareholder of the company. Then, with this $500 million as leverage, Tom Murphy utilized both cash and shares to acquire what was then ABC."

ESPN had long been a subsidiary of ABC, and since ESPN's inception, Steve Bernstein had worked at the network. Thus, his familiarity with the process of Capital Cities' acquisition of ABC wasn't surprising.

Eric immediately grasped the subtext of Steve Bernstein's words.

The intent for Firefly Group to acquire Comcast was already widely known. Likewise, Comcast's secret efforts to engage with AT&T in hopes of acquiring their cable division were not a secret within the industry.

What Steve Bernstein suggested, or rather what Comcast was hinting, was clearly that they hoped Firefly Group could act like Berkshire Hathaway did back then, providing funds to assist Comcast in successfully merging with the AT&T side, while also allowing Firefly Group to become a major shareholder of Comcast in the process.

Of course, the underlying message was also that Comcast did not want Firefly Group to meddle in its management but rather to hold stock in the company purely as an investor, just like Berkshire Hathaway had.

While Comcast's proposal aligned somewhat with Eric's vision of simultaneously acquiring both Comcast and AT&T Broadband side, the final outcome was not what Eric desired.

After Steve Bernstein finished speaking, Eric replied directly, "Steve, you should know that I want control of Comcast, not just a simple investment. If it were just an investment, I could find targets with higher returns and definitely wouldn't choose Comcast."

"Eric, this isn't easy," Steve Bernstein shook his head and said. "Although the Roberts family's stake in Comcast is low, they still possess a strong 33% voting power. Plus, with Comcast's stock price on the rise, if there's no proactive cooperation from Comcast, even if Firefly Group can amass enough stock through public markets, the cost would be steep. Based on my guess, you certainly want to reconcile both Comcast and AT&T Broadband companies, right? But without Comcast's cooperation, that's also quite difficult. The federal agencies will not easily approve Firefly acquiring both companies at once. Therefore, participating in an investment to support Comcast's acquisition of AT&T Broadband and becoming a major stakeholder in the new company is a very good option for Firefly."

"I know that this choice makes it much easier for Firefly Group to enter the cable operator field. However, if we always choose the easier development path, the Firefly system could never have reached its current scale. More often than not, we must select the harder path," Eric said, turning to look at Steve Bernstein, then abruptly asked, "Steve, do you want to become the head of Comcast and run this company on your own?"

Steve Bernstein's eyes flickered at Eric's words, and he actively avoided Eric's gaze, saying, "Eric, I'm currently an executive at Comcast. I will adhere strictly to my professional ethics and will not engage in behavior damaging to my employer."

"Of course, one of my most important requirements for professional managers within the Firefly system is loyalty," Eric said candidly. "If you were to do something harmful, even if you ultimately secured Comcast, I'd find a reason to kick you out. I don't expect you to do anything detrimental to Comcast. In fact, during the forthcoming acquisition process, you can completely avoid the matter. However, once the Firefly Group secures Comcast, I need you to take on the burden of managing this company. So, do you think you could handle it?"

Steve Bernstein hesitated for a moment before saying, "Eric, I can't answer that question right now. Moreover, to be fair, I believe the Roberts family has more extensive experience in cable operations than I do. Even if Firefly Group successfully acquires Comcast, keeping them in their positions would be very beneficial for the company. This is also in line with the Firefly system's usual style, isn't it?"

Whether it was the early acquisitions of companies like Nokia and America Online or the current negotiations with Hasbro, Eric had grown accustomed to retaining the management of these companies.

However, this time, Eric shook his head. "I typically do this because I can't find more suitable managers. Moreover, the premise is that the Firefly system should still have absolute control over these companies; if I wanted, I could replace them at any time. But this time is different. Even if you can't manage Comcast in the future, the Firefly Group also has talents suited to run this company. Plus, I don't want Comcast to operate independently; this company must serve the overall interests of the Firefly system."

Yet this was sure to conflict with the Roberts family's vision, as the founders of Comcast, they would inherently seek more power, and coincidentally, they had that advantage.

Eric continued, pausing briefly before adding, "In short, Comcast's vast scale absolutely doesn't allow for two voices within its management system. Otherwise, this multi-billion-dollar company would descend into chaos, unable to support the growth of the Firefly Group, potentially even becoming a liability.

I'm someone who is very willing to delegate authority to professional managers, but I will never let the Firefly Group fall into the scenario that befell America Online and Time Warner, where multiple factions collide. Fundamentally, the Firefly Group, and indeed the entire Firefly system, can only have one voice, and that voice is mine."

Steve Bernstein realized he had unknowingly wandered off the original discussion. The dialogue had shifted completely away from the purpose of his visit today.

The Roberts family had sent him in hopes that he could persuade Eric to give up the chase for control of Comcast.

However, at this moment, Steve Bernstein also recognized that this decision by the Roberts family was clearly wrong.

As a former executive of the Firefly system, he had spent far more time working at ESPN than at Comcast. Their conversation, even if unwittingly, had begun to feel more like a discussion among "insiders" regarding the company's development.

With a wry smile, Steve Bernstein sought to gather his thoughts but found he had nothing left to say.

After all, Eric's attitude was very resolute; from what he had learned about his former boss, it was clear that once Eric made up his mind, he wouldn't easily entertain compromise.

"Eric, I suddenly realize that I shouldn't continue this discussion with you. Maybe I should fly back to Philadelphia right now and have Ralph send someone else over."

Eric also recognized a similar issue, or perhaps he was somewhat intentional about it. With a smile, he looked at his watch and stood up. "It's almost noon; let me treat you to lunch. You can head back after lunch."

...

Steve Bernstein flew back to Comcast's headquarters in Philadelphia that afternoon.

After relaying Eric's message, the Roberts family realized the matter was unresolvable and decisively prepared countermeasures.

The next day, a local Philadelphia newspaper reported on the meeting between Steve Bernstein and Eric Williams. This was clearly a signal released proactively by Comcast, and the capital market indeed reacted as Comcast's senior management had anticipated, erroneously judging that Firefly Group and Comcast Group had begun merger negotiations.

Thus, as soon as the stock market opened that day, Comcast's share price soared, seeing an increase of over 13% throughout the day, pushing its market value back over $40 billion.

Moreover, according to Wall Street forecasts, Comcast's market value could potentially surpass $50 billion in the near future. This undoubtedly made the acquisition by Firefly Group much more difficult.

Following this, the Roberts family immediately began increasingly frequent contact with Comcast's other shareholders, intent on securing more voting rights.

If the Roberts family's voting shares exceeded 40%, Firefly Group would find it practically impossible to threaten the Roberts family's control over Comcast through open market stocks.

Yet this time, the Roberts family's persuading efforts did not go as smoothly.

After all, from the perspective of many shareholders, maintaining a connection with Firefly Group or acquiescing to a merger with the Firefly system would clearly provide more benefits than allowing the Roberts family to gain complete control. If the Roberts family managed to take full control of Comcast, the stock price's upward momentum would certainly come to a sudden halt.

*****

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