In Midtown Manhattan, at Westeros Company headquarters, Simon arrived in New York on Sunday evening. Monday was spent in back-to-back meetings with the Westeros Company management and various subsidiary heads, some of whom joined remotely, to finalize the second half's bond issuance plan.
Despite Westeros Company's valuation surpassing a trillion dollars, its cash reserves alone were astonishingly high. For instance, Westeros, through consistent dividend contributions from subsidiaries and major sell-offs earlier this year, held a staggering $12.7 billion in cash and short-term convertible bonds.
This figure would be even higher had the company not continuously invested in acquisitions or poured capital into established corporations like Boeing, Freddie Mac, Fannie Mae, General Electric, Walmart, and Berkshire Hathaway in recent years. Moreover, Westeros had secured multiple board seats in these giant corporations, subtly increasing its influence over the U.S. economy and, by extension, the country's strategic direction.
The U.S. is a quintessential capitalist country.
Capital drives everything.
Controlling capital equates to controlling all, albeit with much less visibility.
Excessive cash reserves aren't necessarily advantageous, though, given that the dollar's value is constantly eroded by inflation. Without quick reinvestment, large cash holdings lose value over time. However, as the bull market hit a peak, Simon halted stock purchases in these corporate giants and started tightening other investments.
Investing at this stage would be too expensive.
Stocks that might cost $100 today could, in a year or two, fall to $20-30 when the bubble bursts and the market enters a bear phase.
With the market so bullish, borrowing money was easier and cheaper, especially for Westeros' reputable high-growth companies. This was the ideal moment to amass cash reserves for future opportunities.
After a full day of meetings, the bond issuance schedule for the Westeros Group was finally set.
They would start with America Online.
Following recent telecom deregulation, legal constraints that had previously limited AOL's domestic expansion were lifted. AOL was not only investing in telecom infrastructure but also preparing to enter the cable TV sector.
As is widely known, large-scale telecom investment is a massive capital drain.
In the same way, China needed to list state-owned telecom companies overseas to raise funds.
AOL had been issuing bonds regularly over the past few years, and they wouldn't pass up this chance. In July, they planned to issue a $3 billion long-term bond, either for ten or twenty years. This fund would ensure AOL had sufficient capital for at least the next two years.
Since AOL's heavy expenditure is well-known, beginning with this company would appear reasonable and minimize backlash from capital markets.
Moreover, all the bonds to be issued in the latter half of the year would be targeted mainly at overseas investors to avoid unpredictable effects on the U.S. capital market.
Following AOL, Verizon would go public in August, after which issuance would pause.
Then:
- September: Cisco, $2 billion.
- October: A pause to avoid interference with the presidential election.
- November: After election day, $1 billion each for Nokia, Tinkercade, and Johnston Holdings.
- December: Westeros main office, $2 billion.
The total bond issuance amounted to $10 billion.
This staggered approach was to minimize market disruption.
For anyone with financial knowledge, Westeros' massive stock sell-off earlier this year was a clear signal for some to cash out as a crisis loomed. Yet, common sense rarely prevails. Buffett's saying, "Be fearful when others are greedy, and greedy when others are fearful," distills the essence of market risk, but people often convince themselves they'll be able to exit before it's too late.
As a result, the outcome is predictable.
Unless doused in boiling water, most "frogs" won't jump out of the pot. The phased approach to Westeros' bond issuance would serve as a gentler version of that "boiling pot" effect, exactly the outcome Simon wanted.
As long as the bubble didn't burst due to Westeros' financing actions, he'd be satisfied.
The blame for a market collapse would be too immense otherwise.
After wrapping up work for the day, Simon attended a family dinner at the Rayburns, also joined by the recently returned Robert Iger and his family.
The next day, Tuesday, June 11.
Overseeing the $10 billion bond issuance plan wouldn't happen in a single day, so James Rayburn would coordinate the follow-up steps.
Simon, however, had no time to spare.
On Tuesday, he focused on the East Coast television operations of Daenerys Entertainment.
With summer upon them, it was the off-season for television, and while the May TV upfronts had concluded, networks were gearing up for fall by promoting pilot episodes to gauge market interest.
Daenerys Entertainment was still integrating last year's acquisition of Metropolis ABC Group, meaning the network couldn't afford to slack off. With the Olympics around the corner, even without the rights to the Games, there would still be plenty of Olympic-related coverage across its various networks.
Another major project was the ongoing negotiation for ESPN to secure the exclusive broadcast rights to the NFL.
Since Daenerys Entertainment acquired Metropolis ABC, talks for the deal had dragged on for over half a year. Both sides were taking it slowly, as the current contract didn't expire until the end of the next NFL season, following the Super Bowl. There would be no benefit to an earlier agreement.
Nevertheless, negotiations couldn't go on indefinitely.
They had now reached consensus on several core terms:
Eight years for $9 billion.
This matched the exact price in Simon's memory, which he had set as ESPN's maximum offer at the start of negotiations.
The drawn-out bargaining process stemmed from the NFL's attempt to "milk" Daenerys Entertainment after the Metropolis ABC acquisition.
Unfortunately, Simon had no interest in being taken advantage of.
An eight-year, $9 billion deal was already a generous offer, far more than previous broadcasting contracts. If the NFL tried to push further, Simon would rather start with exclusive rights to the NBA.
Now that the NFL understood Daenerys Entertainment's ceiling, the negotiations hadn't soured and were expected to finalize in July. The contract would only take effect with the next season, and the $9 billion fee would be paid in installments once the contract was active.
At five in the evening, Simon wrapped up the day's work and headed from Daenerys Entertainment's East Coast headquarters on the Upper West Side to the East Village.
In an office building on First Avenue in the East Village.
Simon had barely arrived when Grace Spurlock, who had evidently been waiting for him, came to greet him.
The building was a ten-story red-brick office structure, slightly aged.
During a call over the weekend, Grace had asked if he'd like to check out the models she'd been gathering over the past few months.
It was time for the Elite Model Look competition.
The event had kicked off in April, with tens of thousands of applicants worldwide. After rigorous selection, it was now down to the final 64. These finalists had been flown to North America, signed with Elite, and were undergoing training for the final round of the competition.
Unlike American Idol, which Daenerys Entertainment launched last year, the Elite competition was more straightforward.
In previous years, however, the process had been heavily manipulated.
This issue was one reason why Elite faced scandals in the late '90s, which led to the agency's downfall.
Elite's executives, judges, and even some regular employees had turned the competition into a "hunting ground." Linda Evangelista's ex-husband, Gérald Marie, had famously claimed he'd "sleep with every girl in this stack of photos" during a BBC exposé. The resulting scandal quickly brought Elite down from its peak.
When Grace took over Elite, which then became part of the Westeros Group, Simon ensured there would be no repetition of the past.
With Grace's strict oversight, the competition this year was much more disciplined.
For example, Gérald Marie, former head of Elite's Paris branch, had been ousted last year. Now, Grace held full control over Elite. No longer a place for complacent executives from John Casablancas's era, the agency had undergone a revival, with streamlined processes and greater professionalism, making incidents like before much less likely.
Not that they could be completely eliminated.
In this industry, for every hunter, there are those willing to be prey.
Simon himself was at the top of this food chain. But he wasn't fond of other hunters eyeing his territory, which further motivated Elite's transformation. With better compensation and job security for models and staff, the position's value increased. Executives, especially those with predatory tendencies, had to weigh the risk of being fired if they interfered with Simon's interests.
After all, needs come second to keeping one's livelihood.
Simon entered the building with Grace and several other associates. Noticing the elevator's battered interior, he asked, "Why this building?"
With others around, Grace merely brushed her arm lightly against Simon's without being too intimate. Glancing at him, she replied softly, "Because it's cheap. Elite used to be in Greenwich and then SoHo, but now we're here in the East Village. A few years from now, we might end up in Brooklyn."
Simon chuckled. "Elite shouldn't be short on cash, right?"
Elite had been profitable during the John Casablancas era; otherwise, they wouldn't have been able to rent a three-story office space on Fifth Avenue. Now, after trimming the fat and launching new ventures, Elite was more profitable than ever and might soon be able to afford a headquarters building like Hollywood's CAA.
Grace replied, "We're not short on cash, but I need to be responsible to the shareholders. If I save on unnecessary expenses, there's more to
go around for everyone."
Simon smirked. "With such a great boss, I'm tempted to work for you."
Grace merely chuckled.
They exited on the seventh floor. Turning left, they entered a spacious room, around seven or eight meters wide and twenty meters long. Originally an office space, it was now used as a training room.
The first thing that caught Simon's eye?
Legs.
And more legs.
Everywhere, legs.
A large group of tall, strikingly dressed models, all in fitted training outfits, practiced their poses and runway walks. With almost identical heights, white tank tops, and black leggings that revealed a hint of midriff, the uniformity was almost mesmerizing.
As Grace led Simon inside, the girls paused to look over, intrigued by the young man's presence. He seemed familiar... Was that Simon Westeros?
All sixty-four models, regardless of background, knew the name Simon Westeros. And most had at least seen his image in the media. Once they realized who was before them, eyes began to light up.
Every girl who'd made it this far, through tens of thousands of hopefuls, was exceptionally sharp.
They knew what Simon Westeros represented.
For these models, his connections were nothing short of a staircase to instant stardom.
As more girls recognized him, the room's atmosphere grew electric. Even the trainers couldn't help but glance at him repeatedly. They now understood why today's practice had been extended beyond the usual 5 p.m.
Clearly, it was all for this man.
Simon didn't walk toward the group; instead, he took a seat on a simple bench against the wall. Taking a roster from Grace, he noticed her inquisitive gaze and smiled, "Let them continue. I'll take a look."
Grace nodded, calling over one of the trainers to relay instructions. As the trainer moved away, she joined Simon on the bench, sitting closely beside him.
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