CH429 | Heir

Shortly after the executive meeting, Congressman Choi Jae-seok of the National Economic Party officially announced the primary pledge of his presidential campaign: a 700 trillion won semiconductor city.

“How is the public reacting to the semiconductor city?”

“Not just the media, but even real-time search trends and social media are buzzing with discussions about the semiconductor complex. Land prices in Gyeonggi Province have reportedly started to fluctuate as well,” came the briefing.

“They haven’t even announced which region the semiconductor city will be built in, and it’s already like this?”

“Perhaps because Congressman Choi previously served as governor of Gyeonggi Province, people are speculating that the semiconductor city will be established there,” the vice president explained, his expression a mix of concern and calculation.

He recognised that with Congressman Choi announcing the semiconductor city pledge, there was no turning back.

“Why do you look so troubled? That’s 140 trillion won a year. Isn’t that manageable?”

“To break even, we absolutely need to generate more than 140 trillion won annually,” he replied.

“Why are you excluding the profits already earned? What about the gains from the oil wars or the Chinese short sales? Did we ever lose that money?”

“That money is already in hand. Once it’s spent again, I consider it a guaranteed loss,” he said, displaying a very prudent mindset.

But was that realistic?

The semiconductor city wasn’t the end of my plan. I had even larger, costlier projects in mind, so no matter how hard the vice president worked, achieving net positive profits would be difficult.

“To avoid losses, we’ll need a huge gain from Brexit,” I remarked.

“Our preparations are perfect. But the national vote is still a month away. We have to wait a month to see any profit, and yet expenses keep coming in—it’s frustrating,” came the response.

“You mean the big shipping company deal,” he observed.

The shipping company mega-deal was on the verge of completion. The president had resigned, and the prime minister was serving as the acting head of state.

Unlike the president, the prime minister had reacted positively to the shipping company deal.

“Thanks to the temporary president, who only has 60 days left in office, the big shipping company deal has become possible. Negotiations with the creditors’ consortium, centered on the Industrial Bank, and government officials have been completed,” he reported.

“The creditors will be visiting soon, then,” I said.

“They actually contacted us this morning. They want to negotiate as quickly as possible. Shall I proceed with the negotiations on my end?”

“Will the executives of Hyundai Shipping and Hyunjin Shipping participate in the negotiations as well?”

“Yes, they will.”

“Since the heads of the conglomerates are participating, wouldn’t it be proper for me to greet them personally? Arrange a meeting sometime this week,” he commanded.

The two major shipping companies were finally about to fall into my hands.

How could I leave such a joyous task to Vice President Han? I felt I needed to meet them personally to put the final seal on it.

“Honestly, the shipping company deal isn’t such a huge expense, so I’m not overly worried,” I remarked.

“To acquire two shipping companies, we’ll need roughly 10 trillion won. Aren’t you underestimating that?”

“Compared to 700 trillion won, is 10 trillion really that significant? The problem is not the 10 trillion itself, but the fact that it comes on top of the 700 trillion already planned,” I explained.

10 trillion won was certainly not a trivial sum.

And that was only for the acquisition. Add charter fees and other debts, and the total expenditure would be higher.

These were companies that would continue to operate at a loss.

No wonder Vice President Han didn’t look very cheerful.

“Don’t worry too much. We can dramatically reduce the shipping companies’ deficits, and with a few years of careful management, we can turn them into profitable businesses,” I reassured.

“I don’t doubt your ability. You’re the kind of person who can invest 10 trillion won and reap multiple times the profit,” he said.

“If we keep talking only about money going out, Vice President Han will collapse from stress today. Let’s switch to revenue instead,” I said, changing the topic for his sake.

The target was Yugo Bin, a diabetes medication, and Vice President Han’s expression immediately brightened.

“Sales continue to grow rapidly. Celebrities and entertainers are promoting it voluntarily, even though we didn’t request any advertising,” he reported.

“That’s thanks to Musk getting the first step right,” I added.

“On top of that, the effects of TV and media advertising have driven tremendous sales. Even conservatively, we expect this year’s revenue to exceed 300 billion won.”

Vice President Han was smiling at the 300 billion won in sales.

Even though the outgoing expenditures were in the trillions, he was pleased to earn hundreds of billions. I held my tongue, thinking that saying anything might only accelerate his hair loss.

“Sales will continue to grow. By next year, trillion-level revenue should be easily achievable,” I remarked.

“I agree. Starting with the U.S. and adding sales from Europe and Asia, we should be able to achieve several times the current revenue,” he replied.

“Annual sales growth of over 200%, and in five years, revenue will reach tens of trillions. You can look forward to that,” I said.

“Lately, I’ve been checking Yugo Bin’s sales before bed. I sleep better seeing such positive numbers,” he added.

But not everything was smooth sailing.

With Yugo Bin’s rising sales, some parties were expressing dissatisfaction.

“How has Novo Nordisk responded?”

“They’ve officially lodged a complaint. They demand that we transfer part of Yugo Bin’s shares to them,” came the reply.

“They’ll be sending a lawsuit soon, then,” I said.

“That won’t matter. The contract has already been signed. What can they do? We didn’t seize anything illegally; we purchased it with proper compensation,” he explained.

In truth, it wasn’t completely legitimate.

If anyone could prove that we intentionally contaminated the research data, we could be at a disadvantage.

But how could that be proven? Without persuading Director Chun Min-jung, nothing like that could happen.

“Until they find conclusive evidence, they won’t proceed with a lawsuit. And even if they do, the ones who will suffer losses are them,” he said.

“I agree. Moreover, Yugo Bin’s sales growth has caused Centurion’s stock price to skyrocket,” he added.

Centurion had become a stock that was nearly impossible to buy on the market.

Since I held most of the shares, there weren’t many circulating in the market.

With demand exploding under these circumstances, the stock price was bound to soar at an incredible speed.

“This is just the beginning. Soon, Centurion will independently rise to the top ten in the business world,” I said.

“Is that really possible?”

“Being a Korean company, it will suffer from a Korea discount and be undervalued, but reaching the top ten within five years is manageable. If growth continues at the current pace, I even think it could reach the top three,” I explained.

In fact, even reaching the third spot wasn’t enough.

Before the regression, Novo Nordisk had become the number one European company through Yugo Bin.

“Just hearing that is reassuring,” he said.

“Yugo Bin will generate massive profits in the future. Don’t be afraid just because a lot of money is leaving the company right now,” I reassured him.

“Understood. First, I’ll try to schedule a meeting with the shipping company creditors as soon as possible,” he said.

Money sitting idle only grows as much as the bank interest allows.

But if invested in the right assets, it could multiply several or even tens of times.

So keeping hundreds of trillions of won in retained earnings idle would be an act of cowardice.

Of course, knowing exactly what was about to happen, it was also why I could invest boldly without fear.

***

A few days later, everyone involved in the big shipping company deal arrived at the Taewoo Group headquarters.

The creditors’ consortium, including the Industrial Bank, and Hyundai Shipping were represented by Chairman Jo himself, while Vice President Go Seok-jin represented Hyunjin Shipping as the management delegate.

Once everyone was seated, the head of planning began the meeting.

I was the first to speak, taking the floor as the owner of the Taewoo Group to deliver a welcoming address.

“Thank you for traveling such a long way. I do not intend to be overly ambitious today. I hope the discussions can proceed within a reasonable framework,” I said, looking at Chairman Lee Myung-geol of the Industrial Bank.

This negotiation ultimately depended on the Industrial Bank’s decision, and the chairman nodded in agreement with my perspective.

“Neither the Industrial Bank nor the creditors’ consortium intends to be greedy. We are not looking to make profits from the shipping company sale; we simply want to minimize any losses,” he replied.

“Then, let me present my proposal first. I intend to acquire the shares of both shipping companies at their current market price,” I stated.

“We can accept that condition. But the real issue is the accumulated deficits, isn’t it?”

Acquiring the shares at market price was a given.

The real concern was the deficit caused by years of operating losses.

The shipping companies had borrowed from the creditors to cover these deficits, and Current Shipping alone was partially capital impaired due to nearly 4 trillion won in losses.

Combined, the deficits of the two companies amounted to roughly 8 trillion won.

However, Hyundai Shipping’s market capitalization was only around 500 billion won, and Hyunjin Shipping was not much different.

These were shipping companies carrying debts several times larger than their market value.

“The Taewoo Group cannot bear the deficits alone,” I said.

“I agree with Chairman Kim. For the negotiations to proceed smoothly, Hyunjin and Hyundai groups need to show goodwill,” Chairman Lee responded.

“Hyundai Shipping will cancel all its shares without compensation,” they announced.

They were talking about canceling the shares they held.

If that happened, the value of the shares held by the creditors would rise.

“Hyunjin Group will also cancel its shares without compensation,” they announced.

“Hmm, simply giving up the shares is not enough. Even if we value the stakes held by the two groups at their highest, it only amounts to a few hundred billion won. You can’t just ignore 8 trillion won in debt as if it were a few hundred billion, can you?”

Chairman Lee Myung-geol of the Industrial Bank applied pressure.

Chairman Jo of Hyunjin Group looked aggrieved but continued speaking.

“We’ve already invested over 1 trillion won into Hyunjin Shipping.”

“Everyone is on the losing side here. Yet you can’t even decide to cut a branch? Are you planning to remain at odds with the Industrial Bank and the creditors forever? You must make a decision, at least to calm public opinion,” Lee pressed.

If this negotiation fell through, Hyunjin Shipping would enter court-managed administration, followed by bankruptcy proceedings.

In that case, all the blame would fall squarely on Chairman Jo.

From Hyunjin Group’s perspective, preventing that at all costs was imperative.

The collapse could have a domino effect, harming affiliated companies, including airlines and retail businesses.

“I can contribute up to 40 billion won from personal funds, but beyond that, it’s really difficult,” Chairman Jo admitted.

“And what about Hyundai Shipping?”

“I’ll contribute 30 billion won from personal funds, and we’ll also inject proceeds from the sale of Hyundai Securities,” he explained.

Technically, if a corporation went bankrupt, abandoning shares would suffice.

However, in Korea, listed companies were still widely perceived as the personal property of conglomerate families, which made pressure for personal fund contributions possible.

Of course, even if they didn’t contribute personal funds, it wouldn’t matter—provided they never did business in Korea again.

But Hyunjin and Hyundai Groups still had remaining affiliates that needed to operate in Korea, leaving them no choice but to contribute personal funds.

Failing to do so and proceeding with bankruptcy could bring unknown future disadvantages. At a minimum, some goodwill had to be shown.

If no goodwill was demonstrated, public backlash, retaliation, and targeted investigations could follow.

“Hmm, very well. The creditors will also accept some losses,”

The discussion now moved to the creditors’ side.

It was fair to say that the success of the big shipping company deal depended largely on how much of the debt the creditors were willing to forgive.