Mid-February, an apartment in Boston's Back Bay.
Fine snowflakes drifted outside the window, and a cold wind lashed against the glass, but the spacious living room was warm and cozy.
Beth leaned back on the soft double sofa, a thick cashmere blanket covering her legs. Her belly was already quite prominent, and her due date was around March 10th. Even changing her sitting position was a bit of a struggle for her. She frowned slightly, one hand supporting her lower back, the other gently stroking her belly.
Lin Qi came out of the kitchen with a glass of freshly heated skim milk in his hand. He gently placed it on the coffee table next to her, then sat down beside her and reached out to massage her slightly swollen ankle.
"Did the little guy kick you again?" Lin Qi asked softly.
"He's practicing boxing in there." Beth picked up her warm milk, took a sip, and smiled helplessly. "I swear, if he's this energetic in the middle of the night after he's born, you'll be the one making the formula."
"I've already cleared my schedule for March." Lin Qi smiled and helped her adjust the cushions behind her back for more comfort. "Ready to go anytime."
Beth sighed contentedly, then straightened her expression slightly. " Patrick called half an hour ago using an encrypted line. The lawyers have finalized all the details, but I didn't have them fax it over. You said you would never keep any business documents at home."
"Just talking about it is enough." Lin Qi leaned back on the sofa, picked up an Apple, and slowly peeled it. "How much did Jerry Colangelo ultimately concede?"
"Much more than the 30% we expected." A shrewd businessman's glint flashed in Beth's eyes. " Patrick acquired 49% of the shares in one go."
Lin Qi paused in his Apple motion, somewhat surprised. "49%? That's almost the limit for minority stake. Colangelo's appetite is bigger than I imagined."
"He had no choice." Beth adjusted her heavy body and said slowly, "Last November, his Diamondbacks won the Major League Baseball World Series, which certainly made him a city hero in Phoenix. But for that trophy, he signed a bunch of lucrative contracts. Now, his cash flow has completely dried up."
"I bet his sports group's bank debt is approaching two hundred million dollars, right?" Lin Qi cut the peeled Apple into small pieces and handed them to Beth.
"More, not less." Beth took the Apple. "To keep the baseball team running, he even humbled himself and begged the players to delay their salaries. The Diamondbacks ' partner investors are on the verge of revolt. Colangelo desperately needs a huge cash injection to fill the hole and appease the partners, and Patrick is the only buyer willing to put in real money without 'demanding an immediate takeover.'"
"What about the remaining 51%?" Lin Qi astutely grasped the core question.
Beth laughed, despite the fatigue of late pregnancy, she still exuded the air of a queen in control. " Patrick secured exclusive rights in the agreement, allowing him to forcibly buy all the remaining shares held by Colangelo in 2004 at a pre-determined valuation."
Upon hearing this clause, Lin Qi's eyes lit up slightly. "This sounds familiar."
"Of course you've heard of that, because we copied the NFL's ( United States National Football League ) homework exactly," Beth said softly, leaning on Lin Qi's shoulder. "Two years ago, Art Modal, the owner of the Baltimore Ravens, was also in serious financial trouble. He sold 49% of the Ravens' shares to Steve Bisciotti, with an agreement that Bisciotti could exercise an option in 2004 to buy back the remaining 51% controlling stake for $325 million."
"This is a dignified form of 'euthanasia'." Lin Qi instantly grasped the brilliance of this business logic.
"That's right." Beth nodded. "For an old-school sports tycoon like Colangelo, who is extremely concerned with his image and treats the team as his life's work, asking him to sell the entire team is worse than killing him. Therefore, the public narrative must be very mild: 'Introducing some funds, for legacy planning, and arranging a smooth long-term transition.'"
"From the outside, Colangelo remains the Suns ' top decision-maker, still the chairman of the board," Lin Qi continued, following her lead. "And Patrick is just a wealthy Ireland, a junior who doesn't understand basketball but is eager to learn. For the next two years, Patrick will play the role of a quiet minority shareholder alongside Colangelo, drinking beer with him, watching baseball, praising him in front of the media, and fully satisfying the ego of this Phoenix sports godfather."
"But the contract is written in black and white," Beth, her tone calm yet cruel, touching her pregnant belly. "The Trojan horse has already entered the city. By 2004, when Colangelo's debt mess with the baseball team becomes unmanageable and he's ousted from management by other investors, his personal finances will completely collapse. On that day, he won't even have the chance to back out or find other buyers to compete with; he'll have no choice but to obediently hand over all the remaining shares of the Suns."
Lin Qi pulled out a tissue and wiped the Apple juice off Beth's fingertips.
A 49% stake, plus an agreement to force the buyout of the remaining shares two years later. This is indeed much more sophisticated and discreet than a direct, forceful acquisition on the market. It gives the seller ample face and time to maneuver, while secretly locking up all avenues of retreat.
" Patrick's real estate business in Europe over the past few years hasn't been in vain; his 'phased exit' strategy of slowly boiling the frog is very clever," Lin Qi smiled with satisfaction.
"Now that the Trojan Horse has entered the city, Phoenix will be ours sooner or later." Beth yawned, waves of late-pregnancy fatigue washing over her. She snuggled closer to Lin Qi. "For the next few years, let Patrick soak up the Arizona Suns and play along with that stubborn old man for a few more years. I'm tired."
"Get some rest." Lin Qi put his arm around her shoulder and gently kissed her forehead. "Leave the rest to me."