I Am the Third-Generation Heir of a Conglomerate - Chapter 437



Only Noblemtl

437. Renegotiation (2)

The size of a shipping company is determined by its fleet size.

Simply put, it meant the total weight of cargo that could be loaded onto a ship, and also meant the space inside a ship that was ready for immediate operation.

The total shipping capacity of Hyunjin Shipping and Hyunjin Merchant Marine is approximately 1.1 million TEU.

Among them, the number of ships leased from ship owners and the number of ships owned by Taewoo Group were almost the same.

So the ship owners’ threats to repossess their ships were no longer effective, and now the ship owners were talking with a negotiating attitude.

“I will give you one last offer. I will reduce the discount on the charter fee. A 50% discount on the previous charter fee, an additional 5-year charter fee, and a lump sum payment of the overdue charter fee. This is the maximum condition that Taewoo Group can offer.”

“Still, a 50% discount on charter fees is too much of a deal.”

Even after all this, you still refuse?

This meant that there was some basis for belief, and it was likely that there had been discussions with shipping companies in neighboring countries.

If the Korean shipping industry crashes.

The shipping industries of neighboring countries such as Japan and China were able to take their place.

Perhaps there were conditions attached that would allow them to receive compensation or profit in other ways if a Korean shipping company went bankrupt.

“I repeat, even if the ship owners recall the ships, there will be no problem in operating the ships. Also, Taewoo Group has placed orders for ships with several shipyards. We can secure an additional ship capacity of more than 1 million TEU within 3 years at the latest.”

As the number of ships increased, the ones who suffered the most were the ship owners.

It was a natural market principle that when demand increased, prices would fall, and as time passed, charter contracts became more difficult to secure.

And there was one more important thing in it.

Even if the ships are recovered, the Korean shipping industry will never go bankrupt.

So, this statement also meant that even if the ship was recovered, there would be no compensation from shipping companies in neighboring countries.

Ship owners in trouble.

In particular, CEO Jerry Wang kept his mouth shut, and one of the frustrated ship owners spoke quietly.

“If I sell the ship, can I receive the overdue charter fees in a lump sum?”

“Of course. We will purchase the ship at the current market price, and as soon as the contract is signed, we will pay the ship price and the overdue charter fees in a lump sum. I promise that the deposit will be made within a month at the latest.”

“Then I will sell the ship. Now I want to leave the shipping industry and quietly end my life by going on a cruise.”

“If you sign the contract today, we will pay you the full amount as soon as we deliver the vessel.”

Anything is difficult at first.

As one ship owner stepped forward, other ship owners followed suit.

[I will also sell the ship. I am tired of the daily ups and downs.]

[I will sign an additional 5-year contract.]

[Can we sell some of the ships and contract the rest for an additional 5 years?]

Jerry Wang’s plan went awry.

He tried to unite the ship owners and gain great power.

The ship owners were divided and went off to find their own way out.

“After today, we will not be able to renegotiate on the terms I have proposed. You may either recall the vessel or file a lawsuit for unpaid charter fees.”

“I can’t take it. Now you’re blatantly threatening me. Okay. Sespan will also accept the conditions.”

Even CEO Jerry Wang was moved.

Then, the remaining ship owner, who had been hesitating, accepted the conditions at the same time.

It was possible to save half of the charter fee, which was over 2.5 trillion won.

“I hope we can continue to maintain good relations in the future. Taewoo Group will always listen to the voices of ship owners.”

“Ahem, that doesn’t really fit the current situation.”

They say it’s renegotiation.

In effect, they obtained a discount on charter fees through threats.

That’s why CEO Jerry Wang and the ship owners reacted so indifferently, but no one took it seriously because it was not a deal that would result in a loss for either party.

“I have prepared a banquet for the ship owners. Please go to the hotel next to the financial tower right now. We will treat the ship owners with the best accommodations and banquet. Also, many financial officials from the financial tower have agreed to attend the banquet today.”

“You’re not forcing me to hand over the money I received today to a financial institution, are you?”

“Absolutely not. Rather, it would be more correct to see it as an opportunity. Financial towers are famous for being selective about their customers. No matter how much money you have, it is difficult to sign up for investment products exclusive to VIP customers. However, at today’s banquet hall, it may be possible.”

There was no other meaning to it.

It was a favor to the ship owners who gave them a 50% discount on charter fees.

Of course, it was entirely up to the shipowner whether to accept the favor or not, and as time went on, he would come to realize that today’s banquet was a great opportunity.

“Let’s all go to the banquet hall. We’ll have some drinks or a drink.”

“Mr. Jerry Wang, please stay for a moment. Shouldn’t we talk some more?”

All the other ship owners were sent to the banquet hall.

Only Jerry Wang, CEO of Sespan, was left in the conference room.

Other shipowners have made the big decision to give a 50% discount on charter fees.

In Sespan’s case, since he had already signed a 50% discount contract with me, it was necessary to have an in-depth discussion.

“Ahem, what else do you have to say?”

“Shouldn’t we proceed with renegotiation separately with Sespan? Surely you’re not thinking of just accepting a lump sum payment of charter fees and additional contract terms without any deal, are you?”

The terms of this negotiation excluded Sespan.

In order to get the compensation condition, wouldn’t it make sense to give something additional in Sespan as well?

“Why are you accusing me of being a bad person? The previous contract was only for Hyunjin Shipping. In this negotiation, didn’t we also sign an additional contract for the current merchant ship charter fee?”

“That alone isn’t enough.”

“You’re not saying that Sespan alone should receive an additional discount on charter fees, are you? If we sign such a contract, we’ll be kicked out of the chairman position!”

Representative Jerry Wang speaks earnestly.

He didn’t seem to be groaning, he just seemed genuinely anxious.

“If it is difficult to get a discount on the charter fee, please offer something else. Otherwise, the same thing as the last short sale may happen again.”

“… … How about the information? I know some advanced information that is not yet known to the world.”

The information was also valuable enough.

Some information may be worth trillions of dollars, but is it worth that much when it comes from Jerry Wang?

“Let me hear it first and then let you know the price.”

“There are signs that the shipping alliance is being reorganized. As you know, the shipping alliance is a very solid cartel, so it is difficult to get information.”

“That’s quite interesting information. Please continue talking.”

It is true that information regarding shipping alliances was lacking.

Jerry Wang had been working in the shipping industry for a long time, so he had a lot of information that Taewoo Group didn’t know.

“As you know, there are currently four shipping alliances.”

“I know that much. It’s 2M, G6, 03, and CKYHE, which Hyunjin Shipping belongs to.”

“First of all, two companies will soon withdraw from the CKYHE shipping alliance that Hyunjin Shipping is a member of. If that happens, the CKYHE shipping alliance will collapse, and there is a very high possibility that the shipping alliance will be completely reorganized.”

Reorganization of the shipping alliance.

It was something I vaguely remembered as well.

Three shipping alliances, excluding the largest alliance, 2M, proceed with ‘Gathering’, creating two shipping alliances.

“That’s pretty good information. If you give me more details, I’ll give you a discount on charter fees under the same conditions as other ship owners.”

“I’m glad it helped. But as you know, shipping alliances tend to be closed, so it’s very difficult to get information.”

“Just send me the information you know.”

“The information we have right now is that… there is a merger of two shipping companies under the leadership of the Chinese government. We believe that this will cause a rift in the shipping alliance.”

A new shipping alliance.

The number of shipping alliances was reduced from four to three, and it was expected that the scattered forces would be brought together.

So, if you don’t belong to a shipping alliance, you will obviously suffer great losses, so you have to join a shipping alliance no matter what.

“First, enjoy the banquet. Please continue to send me more information as it comes in. If you send me any good information, I promise to give you a very nice gift.”

“When you say gift, what kind are you talking about?”

“Taewoo Group always prepares gifts that are beyond the recipient’s imagination. So, you can look forward to it.”

“I will mobilize all my connections to gather information!”

Representative Jerry Wang acted as if he were a loyal subject.

It was just an obvious act, and they were only going to hold hands this one time.

Of course, if you send me information, I will compensate you accordingly, but I don’t think he is someone I can trust to have a relationship with him beyond that.

***

While the ship owners enjoyed the banquet.

I called in a vice president and talked about the shipping alliance.

“I heard that there is a high possibility that the shipping alliance will be reorganized. The three shipping alliances, excluding 2M, will be merged into two. The problem is that Taewoo Shipping will not have a place there.”

“Have you decided to name the two shipping companies Taewoo Shipping?”

“It’s just a tentative name. Since it’s a shipping company under Taewoo Corporation, wouldn’t it be more appropriate to just call it Taewoo Shipping? But it doesn’t seem easy to run a shipping company without a shipping alliance.”

Vice Chairman Han also nodded.

Having studied the shipping industry while taking over two shipping companies, he was well aware of the importance of shipping alliances.

“The slump in the shipping industry is becoming prolonged. So, the competition to secure good routes is getting fiercer, and if we exclude Korean shipping companies, wouldn’t we be able to gain that much profit?”

“It seems like they are intentionally trying to profit by excluding Korean shipping companies.”

It might not have been intentional.

However, quite some time has passed since Taewoo Group acquired the two shipping companies.

The fact that no shipping alliances have contacted us during this time also means that there is no need for a Korean shipping company.

“Even if we bow down, it won’t be easy to join the shipping alliance.”

“But if it’s the number one shipping alliance, 2M, there’s a possibility. The current merchant ship has contacted 2M to come up with a self-rescue plan and has reportedly received a positive response.”

“You mean a temporary and strategic alliance? Is that still valid today?”

It was a strategic alliance, wrapped in nice words.

It meant that they would not include us in the cartel, but would at least temporarily join hands.

Even at this point, it was unclear what would happen. Because Hyunjin Shipping and Taewoo Shipping had merged.

“One of the reasons why the 2M alliance is accepting Hyunjin Shipping is to completely collapse Hyunjin Shipping and secure Korean cargo from 2M.”

“That plan has fallen through since Taewoo Group acquired the shipping company.”

“Even so, the 2M is the most likely. The remaining shipping alliances are expected to be reorganized around Chinese and Taiwanese shipping companies.”

“How about joining hands with CKYHE’s shipping company, which was our previous ally?”

“There doesn’t seem to be any shipping company that was part of CKYHE, the former alliance of Hyunjin Shipping, that would join hands with us.”

It was no different from the fate of a duck egg in the Nakdong River.

Of course, it was possible to run a shipping company without a shipping alliance.

Just as the existing Sangsang Marine Company operated its shipping company without any alliances.

However, in order to respond to the slump in the shipping industry, it was necessary to join a shipping alliance, and so there was no choice but to solve this problem through political means.