#97 The Hyenas' Different Dreams. Ilseong, Daehyun, and many other conglomerates that had begun reviewing the acquisition of Jungwoo Group's core affiliates were holding meeting after meeting.
“What from Jungwoo would create a good synergy effect if we brought it in?”
The meeting room where the presidents of Ilseong Group had gathered. At Chairman Seo Yong-geon's remark, the presidents of each affiliate all appealed with their own opinions.
“If acquiring Asin Motors is difficult, I think it would be good to acquire Jungwoo Motors. The synergy effect would be good as well.”
This was the remark of Ha Seong-hun, the president of Ilseong Motors. Seo Yong-geon, who had been listening intently, cut him off.
“You can't even grow Ilseong Motors properly, what are you talking about acquiring another car company for? The entire group is shaking right now because of Ilseong Motors.”
“But...”
“I may have jumped into the car business out of my own greed, but do you think I don't know how Ilseong Motors has been for the past few years? The only reason I'm leaving you in that position is because of our long-standing relationship.”
Ilseong Motors.
It was a sore spot for Ilseong Group. They had jumped into the automobile industry with great ambition in 1995 and had only just begun mass-producing cars this year, but the market's reaction was not good. It had been a long-cherished project since the previous chairman, but Chairman Seo Yong-geon was a particular car enthusiast.
There was a sense that he had jumped in recklessly without proper market research. It had been a strategic choice to grow by stepping on Daehyun, but it could not be called a success.
“That's why wouldn't it be better to acquire Jungwoo Motors? We are in a position of just starting, but Jungwoo is already a company with high recognition abroad.”
“I know. But now is the time for selection and concentration. Isn't Jungwoo Motors' insolvency famous? Let's think about it after this crisis is over. For now, you just focus on maintaining the status quo.”
Director Seo Jae-hoon, who had been listening to the conversation between Seo Yong-geon and Ha Seong-hun, opened his mouth.
“If we must select and concentrate as you say, Chairman, I believe it would be good to acquire Jungwoo Electronics. There will be a synergy effect with Ilseong Electronics.”
“Jungwoo Electronics, you say.”
“Yes. Capital aside, we can't ignore the existence of their production plants spread across the world, can we?”
The quality was inferior to Ilseong Electronics' products, but they boasted of their durability. Above all, thanks to having built factories in various places including Eastern Europe, they were doing quite well in Europe.
“Jungwoo Electronics...”
At Seo Yong-geon's seemingly tempted attitude, Seo Jae-hoon quickly made his appeal.
“Although it was canceled due to the foreign exchange crisis, weren't we also planning to build a factory in Europe? If we can acquire Jungwoo Electronics at a cheap price, we can use Jungwoo's factories as they are. This is the thought of everyone in the restructuring team, including myself.”
“The thought of the entire restructuring team?”
“Yes. Everyone has the same thought about downsizing the group, but they say that electronics, our main business, must continue to grow.”
Seo Yong-geon nodded with a satisfied face.
“Good. Then, Director Seo, focus the group's capabilities and think of a plan to acquire Jungwoo Electronics.”
“Thank you, Chairman.”
Chairman Seo Yong-geon rarely smiled in meetings with the presidents, but he was generous to his heir, Director Seo Jae-hoon.
“How is the restructuring going?”
“We are thinking of retiring more than 30% of the employees at our affiliates. The foreign exchange crisis did cause liquidity problems, but it's also an opportunity to drive out personnel receiving expensive salaries.”
“Right. Proceed without worrying about what others think.”
“I understand.”
Seo Yong-geon, who had been looking at Seo Jae-hoon with a pleased gaze, returned to his characteristic expressionless face and examined the affiliate presidents one by one.
“This is a state of emergency. Do you know what that means? You can be kicked out of your position at any time. Think of every word that comes down from the restructuring team as my order and move accordingly. Understood?”
“Yes, Chairman.”
The presidents answered in a thunderous voice. After the meeting, Seo Jae-hoon moved to the chairman's office with Seo Yong-geon.
“Manager Lee.”
“Yes, Chairman.”
“How is the governance structure reform going?”
“We have all the personnel from the secretarial office working on a plan. Thanks to the foreign exchange crisis, I think we can formulate it favorably for Director Seo Jae-hoon at a low cost.”
Hearing the report from his chief of staff, Chairman Seo Yong-geon nodded and smiled at his son.
“Just keep doing what you're doing. Ilseong will be in your hands. An era will come when we no longer have to care about what the regime thinks. At that time, our Ilseong must be at the pinnacle of the Republic of Korea.”
“Yes, Father.”
It was a warm atmosphere. But the chief of staff's words followed, throwing cold water on the mood.
“Chairman Cheon of Pyeongchang District's shares are the problem.”
“Hah... that old man never goes down.”
“This time again, we handed over quite a lot of convertible bonds to borrow urgently needed dollars. The problem is that not only the convertible bonds but also the stocks of core affiliates are held as collateral. We could face restrictions on our voting rights through a lawsuit.”
Seo Yong-geon, who was thinking about something with a furrowed brow, suddenly asked.
“You said most of the shares went to that kid, Kim Mu-hyeok, right?”
“Yes.”
“That old man didn't even care about Ji-won or Ji-soo...”
“Wouldn't it be because of Cheon Su-man?”
At the mention of Cheon Su-man, Seo Yong-geon clicked his tongue.
“I had her marry for political reasons because of my father, but I never liked that guy from the start. To marry my daughter to a family that just plays with money. How is Hee-gyeong doing?”
“She is in charge of the hotel with Young Lady Ji-soo. Young Lady Ji-soo's abilities are considerable. It has grown by more than 100% compared to the previous year.”
At the mention of Cheon Ji-soo, a smile returned to Chairman Seo Yong-geon's face. Director Seo Jae-hoon, who was watching this intently, faintly furrowed his brow, but no one noticed.
“Ji-soo was always smart. Tell Hee-gyeong to handle the hotel business on her own and call Ji-soo to the group this time.”
“Yes, Chairman.”
“If we file a lawsuit after Chairman Cheon dies, we should be able to take a significant portion of Kim Mu-hyeok's assets. Prepare in advance. We'll have to tell him we'll take care of it if he just hands over Ilseong's shares through negotiation.”
“Understood.”
“And, Director Seo, when Ji-soo comes into the group, raise her and make her your person. You can't trust blood ties, but they are also the only thing you can trust. You know what I mean, right?”
“Yes. Father.”
Seo Jae-hoon had other thoughts, but he didn't show it in front of his father.
“Let's surpass Daehyun with this opportunity. That's why we jumped into the acquisition battle for Asin Motors. Create as much of a bubble in the acquisition price as possible.”
The relationship between Daehyun and Ilseong, passed down from the previous generation, was like cats and dogs. They were rivals. The same thing was happening in all the major conglomerates in the top 10 of the business world.
What would bring them profit? The minds of the corporations were filled with thoughts of acquiring Jungwoo Group from the government at the lowest possible price.
At that time, as each corporation was holding meeting after meeting.
“Don't give a straight answer.”
“Okay.”
“No matter what I say, just say you'll think about it.”
As we drove to the Blue House, I explained today's plan to Han Gyeong-yeong.
“Welcome.”
Kim Hak-kwon, who was in his office, greeted Han Gyeong-yeong and me with a smile.
“Is everything going well with your work?”
“Yes, Mr. President.”
Kim Hak-kwon, who had been asking about our current affairs as if for appearances' sake, quickly and a little impatiently got to the main point.
“Boss Han, what do you think about Jungwoo Group?”
“Jungwoo Group, you mean?”
“Yes.”
“It has a lot of debt, but it is a good company. Though it became that way because of unreasonable expansion. If this were America, Chairman Park Dae-ho would have had to spend the rest of his life in prison.”
“Hmm...”
“Didn't Mirae Investment and several private equity funds show their intention to acquire it? In particular, Mirae Investment seems to be thinking of acquiring all of Jungwoo Group. A good option has appeared, Mr. President.”
I listened to their conversation, carefully observing President Kim Hak-kwon's expression. The president's mask had not yet broken.
“We can't just hand over Jungwoo Group to foreign capital, can we?”
“Even setting aside Jungwoo Group's debt, its size is too large. It's not at a level that can be handled domestically.”
“What are your thoughts?”
Kim Hak-kwon changed the target to me. I smiled nonchalantly and gave my prepared answer.
“Private equity funds are dangerous. Their top priority is profit. A company's potential, growth prospects, its status in Korea... things like these are not their concern. They are simply moving for gain.”
At words that perfectly pinpointed the issue, Kim Hak-kwon showed a slight smile.
“As Boss Han said, there probably aren't many places that would acquire the entire group. Mirae Investment is the best choice. Alternatively, there is the option of handing over a few of the blue-chip companies to a Korean conglomerate. If we do that, I wonder who would be greedy for Jungwoo Group...”
“The thoughts of the Ministry of Finance and Economy and the staff are the same.”
“If I had the funds to acquire it, I would have acquired Jungwoo Group. It has a lot of debt, but if it can overcome the liquidity crisis, it will be able to grow at any time.”
Looking at the nodding Kim Hak-kwon, I added.
“It will take a long time, but it is also good for you, Mr. President, to prevent the dismantling of Jungwoo Group. Be it foreign capital or domestic capital. However, the injection of public funds should be restrained.”
“If we inject public funds, it could go into an emergency system without being dismantled.”
Kim Hak-kwon muttered as if lamenting. I shook my head.
“We can't let blue-chip companies that are short on dollars go bankrupt just to save Jungwoo Group. Especially, America, with the IMF at the forefront, will not stand still.”
The words I offered probably coincided with the opinions of the economic officials and staff, including the Ministry of Finance and Economy. After hearing the answer, the president seemed to think for a moment, then questioned Han Gyeong-yeong.
“What kind of investment firm is Mirae Investment?”
“I know it to be a pretty solid investment firm. Until now, it seemed to be investing in real estate, but seeing as they are reviewing the acquisition of Jungwoo Group, we must assume they know how to take advantage of Korea's crisis. They might invest for the long term. But the source of their funds...”
“The source isn't important right now. We need dollars immediately. No, we must save Jungwoo Group.”
“I know.”
“Do you have any thoughts of acquiring Jungwoo Group?”
“What? Me?”
“Yes, I would like Dreamhigh Investment to acquire it.”
“Umm...”
Just as I had said, Han Gyeong-yeong showed a hesitant attitude. Because Han Gyeong-yeong did not readily answer, President Kim Hak-kwon furrowed his brow, seemingly frustrated.
“You may be an American, but you are also a Korean born in Korea. I'm asking you a favor. If we overcome this crisis, the government will help you acquire it at a good price. What do you say?”
“Jungwoo Group's debt is too large. The amount that disappeared due to accounting fraud, embezzlement, and breach of trust will also be substantial. I enjoy aggressive investments, but the risk is too great.”
“You just need to take it on for a little while.”
When Han Gyeong-yeong politely refused, President Kim Hak-kwon finally acted like someone who had entrusted him with money.
“Take it on... Mr. President, I'm not a philanthropist, am I?”
“...”
“If I were to jump into the acquisition battle for Jungwoo Group, I would do so with the intention of making it the world's best company. I have no intention of jumping in just to resell it at a good price. But isn't it true that Jungwoo Group isn't a more attractive company than the blue-chip companies in America?”
This was the problem with the Republic of Korea. Beyond the collusion between politics and business, the government's intervention in corporate affairs was too severe. The upcoming business swap was the same.
They forcibly handed over the conglomerates' companies to corporations that suited the government's taste. It was the same during the military regime, and it was the same now after achieving democratization.
“If you want me to acquire Jungwoo Group, then make an attractive proposal to me, the investor. Money has no emotion. It's not that I don't have affection for Korea, but it's too much money to bet on for the sake of patriotism.”
At Han Gyeong-yeong's demeanor, so completely different from how other conglomerates behaved toward him, the mask Kim Hak-kwon was wearing cracked. Seeing the president furrow his brow, clearly displeased, I opened my mouth.
“Mr. President, may I say a word?”
< The Hyenas' Different Dreams. > End