The Chaebol Who Flies From Space - Chapter 13
Only Noblemtl
13. Eat raw (2)
It’s easy to say, but is it really that easy to take over someone else’s company? I had to figure out the atmosphere first.
Using his connections here and there, he had a meal with representatives from all of Toad’s major creditor banks.
Deputy Director Jin, who was a practitioner, came to the dinner table with difficulty after hearing that there was an intention to take over the toad.
I was cautious, but our food company, which I am in the background of, is a very successful company.
Sales are growing rapidly and net profit is also skyrocketing. I dug up a business card for our food director for this meeting.
“Wouldn’t it be difficult to take over Jinro with just our food?”
“Don’t worry. If we do the acquisition, we’ll do a massive LBO. We’re talking to Citibank.”
“That would be enough to tell a story.”
When he heard that there was another source of water in addition to his own funds, Vice President Jin’s expression softened. Then he immediately revealed his true feelings.
“So you’re saying that a company that had 2 trillion won in debt before the IMF has now increased its debt to 2.7 trillion won?”
“We are holding on to it as interest rates stabilize, but debt will continue to increase in the future.”
Although the interest burden is decreasing as the corporate bonds issued at ultra-high interest rates are reaching maturity, they still have to be repaid in full as interest if they make a profit.
As the Daewoo scandal made the domestic financial market unstable, the company’s crisis showed no sign of ending.
All the companies that were worth selling had been sold off, so now there weren’t many companies left to sell to.
Only the original mainstream portion remains, and this is a goose that will spread its wings and lay golden eggs as soon as the bad debt problem is resolved.
It was an area that could not be touched rashly. That is why the company’s major shareholder was also strongly opposed to the sale.
The number one company in the soju market, where consumption actually increased despite the recession, was Dugeobi Soju. With a market share of 48%, there was only one soju company in each province, so it had to be considered the only one nationwide when it came to production.
“How long can a toad last?”
“This year is also unstable. The financial market was not greatly shocked because of Daewoo. Our bank is also in chaos right now. Everyone is nervous that there will be talk of bank consolidation again. Daewoo is Daewoo, but if Toad goes over, the damage will be too big. We hope that a sound company will somehow take over the company. Our bank has lent more than 2 trillion won to Daewoo. If Toad goes over, our bank’s BIS will not be at ease either.”
Perhaps because the situation was so dire, he spoke frankly about what was happening inside the bank.
Well, didn’t banks that seemed like they would never fail just a few years ago go bankrupt one after another?
There were more than one or two bank workers who were cut and kicked out.
“How much is Chairman Lee Ho-yeon’s major shareholder’s stake?”
“If you include hidden shares, it would be over 40%, but Chairman Lee Ho-yeon’s revealed share is 38.5%. As the company is in trouble, most stakeholders would have disposed of their shares. I believe the maximum is 45%. I think he is holding on to his shares because of his actions.”
Most of those who owned stocks, including family, relatives, and company officials, sold off their stocks without hesitation when the company faced difficulties due to the IMF crisis.
Chairman Lee Ho-yeon, the founder’s second son, is the only one who cannot give up his obsession and is holding on to his stocks.
Even if the principal and interest burden is reduced due to the composition application, Dugeobi Soju will go bankrupt when the composition period expires in 2003.
Even if it could be endured, speculative capital including Goldman Sachs would not leave it alone.
The company purchased 1.9 trillion won worth of corporate bonds issued by the company from foreign companies at a bargain price of 20% of the face value.
After the end of the period of peace, they would have been aiming for huge investment returns by bankrupting the company and selling it elsewhere at a high price.
Meanwhile, only the domestic banks that lent money to the toads are dying. They are not receiving the interest properly and eventually even have to adjust the loan amount.
In short, from the banks’ point of view, if they could get out at any time, they wanted to do so as soon as possible.
“Oh, those bastards really like to eat each other raw. I found out that they’ve spent 400 billion won on corporate bonds, and they’re planning on pocketing over 2 trillion won, and they’re also frugally grabbing shares. They’re diligently buying stocks as they come up for sale. Those bastards.”
We have already investigated where the shares of Dugeobi Soju have flowed, and found that more than 15% of the shares have flowed to foreign companies through paper companies.
I work at a bank, but from a Korean perspective, just hearing it makes me feel uncomfortable.
“Oh my, just hearing it makes my heart ache.”
In the past, we would have stopped their tyranny through domestic laws or invisible regulations, but the specter of the IMF was still weighing on the Korean economy.
It is difficult to hastily come up with regulatory measures, so nothing can be done.
I quietly told the frustrated Manager Jin about the real purpose of today.
“How is the cash flow of Dugeobi Soju? Is Chairman Lee Ho-yeon doing something strange?”
“How could that be? We are closely monitoring the flow of funds.”
I shook my head at Manager Jin’s answer.
“They’re probably doing something else. At least for a while, they were able to breathe. It’s not like big companies are creating slush funds for the first time or two.”
This chairman inherited a profitable company, but he was obsessed with expanding the business and ruined the company in an instant. He was not the type of person to correct that habit.
“Are you saying that this chairman is embezzling company money? The bank is keeping its eyes wide open.”
“Isn’t that obvious? If something goes wrong with the company, you’ll go from being a conglomerate to a beggar. Now, you’re not in a position to be picky.
What do you do when it’s all blue? Even though he’s a bank employee, he’s not free with money. According to Ariel’s investigation, the flow of funds in the toad was already flowing strangely.
“Slush funds? If they’re doing something else while the company is going under… I guess we should look into it.”
Just thinking about it made him feel hot, so Chief Jin drank his glass one after another.
A separate investment company was created to acquire Dugeobi Soju.
It was easy to save people.
It was full of retired financiers who had yet to find a job.
I asked the recruiting company to scout personnel related to M&A and hired 8 people first.
The idea was to hire additional personnel based on the progress of the work.
If the market flows as I think it should, there will be plenty of companies that will need to merge and acquire in the future.
Manager Kim In-young was a practitioner in charge of mergers and acquisitions at the already-defunct Dongseo Securities. The mergers and acquisitions team he led was transferred to the company in its entirety.
“As you said, we investigated and confirmed that the chairman’s slush funds had been transferred to Cambodia’s ABA Bank.”
It was difficult to find traces of the slush fund creation through shell companies, as this was not the first or second time it had been done.
It is really hard to find a way to recover the difference by over-pricing the goods.
The chairman embezzled company money in various ways. It was truly pathetic that the owner was embezzling money even though the company was barely surviving after the hit Toad two years ago.
“How much do you think it will be in total?”
“I don’t know the exact amount unless I am the owner, but if you look at it from all angles, it seems like they embezzled close to 100 billion won.”
“······.I have nothing to say.”
“This kind of person should not be in business. He already ruined the company once and now he’s trying to suck the backbone out of it!”
Dongseo Securities, which went bankrupt during the IMF crisis, was a securities firm that was doing quite well.
If it weren’t for the corporate bond guarantee issue, it would never have failed. It was a company with a good human resource structure and many capable people.
How many tears of blood must have been shed by the employees as the company failed so foolishly?
Manager Kim’s face turned red as if the incident had come back to him again.
“What did Manager Jin say? He mentioned it to me last time we had dinner.”
“We are investigating by mobilizing the line, but it seems that it is being blocked from above.”
“He would have eaten the embezzled money all by himself. He would have stashed the money here and there. That’s why he still does such things so brazenly.”
“What should we do?”
“What can we do? We have to let our chairman eat the country’s food. The businessman who requested the meeting embezzled company money? This is something that cannot be done, and he should be arrested immediately.”
At first, I thought about giving a bribe to the chairman to take over the company, but it might be difficult to handle later.
Those water-drenched Goldman bastards will never stay still.
So, I decided to take over the company as planned. It didn’t seem like the chairman would give up the company easily.
“Ask Director Jin for the data he investigated. Recommend a prosecutor to hand it over. We need to make it look pretty.”
The country was turned upside down by the Daewoo incident, and the chairman of the bankrupt company embezzled company money. Naturally, when the prosecution investigation began, public outrage boiled over.
– Toad, isn’t this company already bankrupt?
– It’s ruined, but the owner is still there?
– Don’t you know the meaning of reconciliation, you idiot? The loan principal and interest payments are deferred. The owner remains the same.
– What kind of bullshit law is that? The company went bankrupt, but the owner is still the same? That’s why that XX embezzled company money.
-Arrest them! Arrest them!
– Arrest him immediately and return the money he stole!!!
When the issue of slush funds for toad soju was added to the already bad social atmosphere, the government did not hesitate to draw its sword.
Since Daewoo’s Chairman Kim had fled overseas, a scapegoat was needed to shoulder the public’s anger.
All the information investigated by the bank and the information identified by Ariel had been handed over to the prosecution, so in a situation where there was no way to escape, things progressed quickly until Chairman Lee was arrested.
“Are you sure you have enough money?”
[Who am I? I am Iriel, the best artificial intelligence on Earth. Do you think those crappy investment programs can handle me! Hahaha.]
This seems to be getting crazier and crazier.
How do we deal with an artificial intelligence that has gone mad?
“Stop talking nonsense. Tell me about the return on investment.”
[Ahem, I saw a stock that was about to hit bottom and go up, so I bought a bunch of options]
“You bought options? That must have been a huge profit.”
[What can I say? There was a stock called Amazon. The stock price, which was over $100, fell to $6 in a year. There was a lot of talk about it going bankrupt, but I bought it after hearing that they were pushing for a large-scale layoff. It was a stock that would skyrocket if it didn’t go bankrupt.]
“so?”
[I created a miracle by turning $24 million into $450 million. Hahaha. I’m good after all.]
An AI that brags about itself!
I wondered if I had been too liberal with the AI personality settings.
“There won’t be any problems, right? The securities authorities are sensitive to overseas capital outflow these days.”
Overseas investment, which had been freely allowed to flow out, was frozen solid by the IMF. If there was money flowing out of the country, they were keeping a close eye on it.
[What is the problem? I sent the money that was supposed to be used to buy wheat from a ramen company. The contract was postponed for a while, so I used that money. What is the problem? The contract was executed normally, and the wheat is already coming into the country.]
“···. Okay, there shouldn’t be a problem. How much is 450 million dollars in Korean Won?”
[If you calculate it at the current exchange rate, it would be a little less than 600 billion]
“600 billion? Is that enough? Don’t you have to pay taxes too?”
[What’s the problem? You can just make another bet. Right now, it’s half fish and half water. There are more than a few companies that have gone under since the IT bubble burst.]
“A failing company? How long will it take?”
Investing is good, but don’t you need funds to acquire a toad right away?
[I don’t think it will take long. Even though it is obvious that it will fail, people can’t give up their foolishness. I was terrified when I saw the buy report from the securities company. So I checked again, and it looks like they will file for bankruptcy by the end of the year at the latest. I have to eat it up.]
There were a lot of bankruptcies here and there.
Even the company that was being pursued, Toad, temporarily faced a cash crunch when its chairman was arrested, and talk of bankruptcy began to circulate.
“What is the name of that company?”
[These guys, Enron, have been very serious about their creative accounting. They turned a deficit of $500 million last year into a profit and inflated the size of the profit through self-trading, but when you look at their financial situation, it’s a total mess. They’re the fifth largest company in the U.S., and they’re so big that short selling is a breeze.]
Ariel’s words made me think for a moment.
What time is it?
Even while in custody, the chairman held on to his stocks tightly and refused to let go.
The bank has seized the stocks that were used as collateral, but the chairman has filed a lawsuit, so time is needed.
[But Master, there is something strange]
“What’s strange?”
[The flow of funds in the stock market and the crude oil market is strange. The money is moving as if there will be a large-scale crash and surge. It feels like a big incident is about to happen. No matter how I look at it, I can’t figure it out.]