CH404 | Heir

The next day.

I told Vice Chairman Han about the negotiations with Vice Chairman Oh Yong-jae.

He scratched his head, looking like he had a lot to say.

“Something doesn’t sit right with you, does it?”

“To be honest, I just don’t understand. I know this is at Chairman Oh Hee-gun’s request, but I don’t see why we have to go this far. Samsung Group is the only real rival Taewoo Group has in Korea. Wouldn’t it be better for us to simply leave them alone? That would help Taewoo in many ways.”

Vice Chairman Han had truly become a man of Taewoo.

His way of thinking revolved entirely around what benefited Taewoo Group.

“If we only look at the short term, then yes. If Vice Chairman Oh Yong-jae goes to prison and Samsung Group takes public heat for accounting fraud, we might even gain from it.”

“That’s exactly what I was thinking. Of course, Samsung Group wouldn’t collapse from something like that, but they’d definitely stumble.”

“Taewoo has its limits. Even if we’re called a multinational company, at the end of the day we’re still based in Korea. If we want to grow even higher, we’ll need the cooperation of other Korean conglomerates too.”

Samsung Group was no longer a rival.

Taewoo Group had already moved beyond Korea and was running toward the top of the world. There was no need to hold Samsung back anymore.

“Do you think Samsung sees it that way? Even if we help them now, they’ll always be looking for an opening to overtake us.”

“Let them try. All I want from them is to shield us from the government and the press.”

“You expect Samsung to play the role of a dam?”

“Whenever a new administration comes in, they look for a scapegoat. As long as Samsung Group stays strong, Taewoo won’t be the target.”

“Still, this feels like too much. Especially granting them joint production rights for insulin and the flu treatment. That’s far too generous.”

Samsung’s very existence was already a huge benefit to us.

There was no need to go so far as to share insulin and flu production rights.

And yet, I had decided to do exactly that. Not only because we had a new drug to serve as our cash cow, but also for another reason.

“For Korea’s bioindustry to advance, Samsung Bio has to grow as well. A time will come when enormous quantities of medicine will need to be produced here in Korea.”

“You mean the diet drug?”

“Not just that. If another massive epidemic like the swine flu breaks out, the entire Korean bioindustry will need to grow together to handle it.”

It was said with the coronavirus in mind.

At the moment, no one could have imagined that the coronavirus would ever spread.

But Centurion and the Taewoo AI Center were already researching pandemics like it.

The moment the coronavirus broke out, Centurion would be the fastest among all pharmaceutical companies to develop a treatment.

That would mean producing an enormous quantity of medicine, and Centurion’s factories alone could never keep up with demand.

“Are you saying Samsung Bio’s growth will help Centurion grow as well?”

“It’ll help a great deal. To be precise, for us to increase our revenue, Samsung Bio has to get bigger.”

The most profitable business in the end was royalties.

With new drugs, the royalty business was massive.

The larger Samsung Bio became, the more drugs it could produce, and the more royalties we could collect.

“Wouldn’t it be better just to expand Centurion instead? Why bother sharing with Samsung Bio?”

“If demand drops, the factories would stop running. For risk management, we can’t handle all production ourselves.”

“So when demand is low, Centurion will produce alone, and when demand is high, Samsung Bio will take on some of the orders?”

“Exactly. It’s excellent for risk management, don’t you think?”

I was a Taewoo man too.

Aside from my grandfather, no one was more Taewoo to the core than I was.

Of course, all of my plans put Taewoo first. The joint growth with Samsung Group was necessary only because it benefited Taewoo’s development.

“If things go as you say, Chairman, then it’ll indeed be a huge help for risk management.”

“And it will go that way, so don’t worry. More importantly, how are things progressing in China? I heard cheers all over when we moved into the Financial Tower. The situation must be looking good.”

“The downturn continues. The market has already fallen more than 15%.”

A drop of over 15% in less than a month.

For a short seller, such a falling market was a rare opportunity.

And the decline wasn’t over yet.

“The Chinese stock market will fall to the 2,800 level. Keep short-selling.”

“Last month, the Chinese market was at 5,100. Are you saying it will drop by more than 40%? I’ve heard the government is preparing various measures to stop the decline.”

The Chinese government was indeed making every effort to prevent the fall.

But all of it was in vain. None of their efforts could stop the market that was plunging off a cliff.

“The downturn will last until January next year. Plan your exit for around mid-January.”

“If the Chinese market really drops by more than 40%, … we could earn even more than we did during the oil war.”

“Exactly why we spend so much on lobbying the Chinese elite. Do you think I hand them money for nothing?”

“Looking back now, it doesn’t feel like a waste at all. If anything, it feels like we got off cheap.”

It wasn’t just the market itself that was falling.

A declining stock market was proof that companies were struggling.

Every day, dozens of Chinese companies were going bankrupt.

“And once stock prices hit bottom, we’ll buy stakes in a few solid companies.”

“Are you planning to acquire stakes in IT firms?”

“In a variety of companies. IT, of course, but also liquor companies.”

“When you say liquor companies, do you mean Maotai? It has nothing to do with Taewoo Group.”

But liquor wasn’t completely unrelated to Taewoo.

Taewoo Trading already held the rights to sell a wide range of drinks, from cola to coffee. Adding liquor on top of that wouldn’t be strange at all.

“Acquire a stake in Maotai under Taewoo Trading’s name. It’ll be a big help for the company.”

“Maotai may be the most famous liquor company in China, but I didn’t think it was important enough to catch your attention, Chairman.”

“That’s only true for now. In just a few years, its market cap will surpass Coca-Cola and Pepsi.”

Vice Chairman Han could hardly believe his ears.

It was understandable. At that time, Maotai’s stock price was only around 250 yuan.

By January, it would plunge even further, down to about 195 yuan.

And yet here was the claim that such a company would one day surpass Coca-Cola in market capitalization. Who could believe that?

But Maotai wouldn’t just surpass Coca-Cola.

It would grow into a giant liquor company so massive that it would even overtake Samsung Group’s market cap.

In the span of just five years, it had the potential to increase nearly tenfold.

“You rate Maotai’s potential that highly?”

“Even if only half of my prediction comes true, we’ll still make at least three times our money. Do you still object?”

“No, sir! If we can triple our money, we must buy it without question.”

“Start securing shares gradually at the end of this year. Then, once January comes, move aggressively to acquire more.”

“The short sellers are dumping a massive volume of liquor stocks into the market. It shouldn’t be difficult to acquire a position.”

The profits could come from Maotai.

But aside from high returns, Taewoo Group also needed to acquire companies that would support its strategic growth, even if the profit margin wasn’t as large.

“If you can, acquire a Chinese shipping company as well. Of course, we’ll first crush them with short selling and then buy them cheaply afterward.”

“I’ll put together a plan so we can acquire a shipping company of decent size.”

The Chinese cultural ban and the looming US-China power struggle were not far away.

Before that, we had to extract as much profit from China as possible to minimize the damage.

Not just minimize it, but position ourselves to lead. That meant when the opportunity appeared, we had to seize it with everything we had.

***

A few days later.

I went to visit Centurion.

CEO Seo Jeong-jun and Dr. Kim Jang-woo were waiting for me, both wearing slightly gloomy expressions.

“You look rather down. I take it the contract with Samsung Bio has weighed heavily on you.”

“I knew the contract was going to happen, but now that we’re actually carrying it out, it doesn’t sit well with me.”

Centurion’s CEO was Seo Jeong-jun.

That was why, before negotiating with Samsung Group’s Vice Chairman Oh Yong-jae, I had already spoken with Seo over the phone.

I had told him there was a possibility we might collaborate with Samsung Bio.

Even then, he hadn’t reacted positively, but he couldn’t oppose my decision outright, so he had let it pass.

“Let me make one thing clear. I made that decision for the sake of Centurion’s growth. If Centurion suffers even the slightest loss, I will personally compensate with my own assets.”

“No, sir, that wasn’t my intention. It’s just… handing over the manufacturing technology we worked so hard to master to Samsung Bio doesn’t feel good.”

It was an understandable feeling.

They had bowed their heads to learn the know-how, endured countless trials and errors, and finally mastered the manufacturing process.

Now they were expected to hand over not just the technology but also Plant 1. How could that sit comfortably with anyone?

“Centurion can’t keep producing only insulin and swine flu treatments forever. The day will soon come when even our factories won’t be enough just to produce the new drug Centurion is developing.”

“You mean the diabetes treatment currently under development?”

“Yes. A diabetes treatment and at the same time a miracle diet drug. It’s a new medicine that will generate hundreds of times more revenue than insulin or the swine flu treatment. A true cash cow.”

CEO Seo scratched his head.

From his reaction, he clearly didn’t expect the new drug in development to bring in anywhere near that level of revenue.

“The development is proceeding without any setbacks. Dr. Kim Jang-woo is leading the project.”

“To be honest, it’s hardly even development. Novo Nordisk already completed over 99% of it. We’re just making slight modifications.”

Dr. Kim Jang-woo spoke with an embarrassed look.

He felt ashamed to say that he was developing a new drug when, in truth, someone else had already done almost all the work.

“How soon do you think the new drug can be completed?”

“If things go quickly, it could be ready by the second half of this year. Honestly, we could release it right now and it would be fine. There are no fatal side effects at all. In fact, there’s hardly anything I need to adjust.”

“Then, CEO Seo, please take the lead in moving the FDA approval process forward as quickly as possible. Taewoo Group will help to expedite things on our side.”

There seemed to be no issues with the new drug’s development.

Which meant it was time to focus on the next one.

A few years from now, a coronavirus treatment would emerge, and I was determined to make sure Centurion monopolized it.