Han Chan-young was constantly monitoring the stock price of Seosung SB. Recently, foreign buying increased, and the circulating volume continued to decrease.
Naturally, the stock price rose from 170,000 won to 200,000 won.
However, the current situation of Seosung SB didn’t seem promising in terms of performance or market expectations.
“Is Vice Chairman Im Jin-yong buying to defend management rights?”
Eunsung Motors had started purchasing using proxy accounts, and the National Pension Service was doing the same.
But then…
[Seosung SB Sells All Of Its Treasury Shares!]
[OTK Company Acquires 11% Stake in Seosung SB!]
Han Chan-young mumbled in disbelief as he read the articles.
“Is it OTK Company again?”
At this point, it felt like a tough curse.
They snatched X-Cop right before his eyes, lured away Team Leader Sangwon, and stirred up trouble by getting involved in labor issues with subcontractors.
As a result, Chairman Hong Woo-song was imprisoned, and Eunsung Motors had to endure public criticism for a time. But, as always, public opinion quickly calmed down. Car sales remained stable, and Eunsung Motors continued to subcontract parts to Woosung Industries.
Nothing had changed.
During this time, Kang Jin-hoo had completely distanced himself from Korean political and business circles. He didn’t show up at events or official functions and rejected all meeting requests. He didn’t build connections with business magnates or sponsor politicians.
So it was assumed he disliked chaebols and politicians, yet who would have thought he would align with Seosung Group? This was unexpected.
“When did the conversations with Vice Chairman Im Jin-yong begin?”
Judging by the timing of the purchases, it seemed they started moving before Chairman Im Il-kwon’s death. Did they have contact before that?
The original plan was for Im Seung-yong to take over as CEO, then oust CEO Lee Su-hak, and sell off treasury shares to Eunsung Motors.
Afterward, when the National Pension Service sold on the market, acquiring about 10% would be easy. But suddenly, OTK Company intervened, complicating matters.
The buyback of shares was unsuccessful, but the plan itself was not completely derailed. First and foremost, it was important for Im Seung-yong to secure control over Seosung SB.
Han Chan-young called Im Seung-yong to discuss future matters.
***
Im Seung-yong finished his conversation with Han Chan-young.
The business world did not view Kang Jin-hoo favorably, and he felt the same way.
But who would have thought the heir of the Seosung Group would ask for help from a financial speculator? What could he possibly be lacking?
He couldn’t understand it, but it highlighted the difference in character between him and his brother.
Im Seung-yong had significant dissatisfaction regarding his share.
Even if Seosung Heavy Industries and Seosung Engineering were combined, the market cap would only amount to 7 trillion won. In contrast, Seosung SB’s market cap exceeded 20 trillion won at its lowest point and over 40 trillion won at its peak.
If his mother hadn’t supported him, he wouldn’t even have dared to consider this. However, Yeon So-hyun held a substantial 5.8 percent stake as the largest individual shareholder of Seosung SB. Adding his 4.7 percent made it a total of 10.5 percent.
Considering cooperation with Eunsung Motors and support from the National Pension Service, it was a battle worth fighting.
The problem was OTK Company…
“Are they planning to intervene in the management rights dispute to take a share for themselves?
They are no different from vulture funds in that they will do anything for profit.
In any case, a 1 or 2 percent difference in shareholding is not significant in the current situation.
Unless one side secures a majority stake, the decisions will be made based on the sentiments of other shareholders.
And in that regard, he believed he had an advantage over his brother, thanks to his backing from Eunsung Motors and the government.
***
The sale of treasury shares can be both a positive and a negative factor.
The market initially viewed it as a positive signal.
– What is the reason for the sale of treasury shares?
– It seems to be aimed at securing friendly stakes before appointing a new CEO.
– Wasn’t it supposed to be Im Jin-yong?
– His brother, Im Seung-yong, is a director and the second-largest shareholder with 4.7%.
– Is OTK Company acting as Im Jin-yong’s white knight?
– It seems both sides are trying to secure shares, so remember to stay patient.
In just a few days, the stock price hit 230,000 won.
Some institutions deemed the rise too much and began selling, but the National Pension Service continued to purchase.
Even if the stock price temporarily fluctuates, it tends to return to its intrinsic value. If the stock surged due to a management rights dispute, it could crash once that issue is resolved.
“Look at the audacity of spending money that isn’t theirs.”
“This is why ‘blind money’ is good.”
After all, it’s not their money; it’s the people’s retirement funds. So they can buy without any burden, even if they eventually incur losses.
As a result, the National Pension Service’s stake has approached nearly 20%. Meanwhile, over there, they have already secured more than 30%.
On the other hand, when combined with Golden Gate, our portion just falls short of 30%.
The shareholders’ meeting for Seosung SB is not far off.
It’s about time to reveal our cards…
The first to strike was them.
We recently purchased Seosung SB’s treasury shares at a 20% premium over the average stock price for the past month, at 210,000 won per share. After this was announced, buying momentum surged, and the current stock price is nearing 240,000 won.
The Joongilbo raised this issue.
They claimed that selling treasury shares at over 10% below market value caused losses to the company.
In fact, clearly measuring a company’s value is extremely difficult. Depending on whether you use PBR, PER, or ROE as the standard, the differences can vary from tens of percent to more than double.
The primary benchmark for evaluating the value of a publicly traded company is naturally its stock price. This is because the stock price is determined by market participants who evaluate assets, earnings, and prospects (though that doesn’t mean it’s necessarily rational).
There are instances where the stock price is intentionally kept low to grant preferential treatment before selling, but regardless, if they sold it at a premium over the then-current stock price, there wouldn’t be grounds to claim embezzlement.
SeosungSB argued that “this is merely a retrospective discussion, and predicting how stock prices will move from the time of the contract is impossible.”
In response, Joongilbo questioned why they conducted a block deal with a designated buyer rather than through an on-market sale or a public sale, suggesting that it granted preferential treatment to OTK Company.
Several conservative groups reported CEO Lee Su-hak of SeosungSB to the prosecution on charges of embezzlement.
Taek-gyu remarked in surprise, “It’s surprising to see a conservative group report Seosung Group. Didn’t they used to support them?”
“True,” came the reply.
To an outsider, it might seem like an invisible hand is at play.
Regardless of the truth, SeosungSB shareholders welcomed the situation.
When news broke that CEO Lee Su-hak was under investigation, SeosungSB’s stock price rose by 5% and surpassed 250,000 won.
***
Media outlets were already lined up at the photo line.
As CEO Lee Su-hak got out of the car, reporters thrust their microphones toward him.
“What do you think about the allegations of selling treasury shares at a low price?”
“Do you acknowledge any preferential treatment?”
“Were there different contracts with OTK Company?”
“Please share your purpose regarding the sale of treasury shares!”
CEO Lee Su-hak looked at the cameras and spoke.
“I will sincerely cooperate with the prosecution investigation.”
With that one line, he entered for questioning.
As Taek-gyu watched the news, he said, “Isn’t this going too far?”
“Well, it’s just a witness investigation,” came the reply.
They’ll probably just ask a few irrelevant questions and wrap it up.
The reason for the prosecution’s summons is to inflate suspicions. Even just the allegation of embezzlement against Lee Su-hak, associated with Im Jin-yong, benefits Im Seung-yong.
“Isn’t this going to turn the government and Seo-seong Group into enemies?”
I shook my head.
“The roots of the collusion between politics and business aren’t weak enough to be shaken by this kind of dispute. They manage just fine even with the CEO’s arrest and a raid on the headquarters.”
They might blush now, but later they’ll shake hands with smiles, as if nothing ever happened.
Taek-gyu nodded.
“True, friends usually grow by fighting.”
In this context, President Park Si-hyeong emphasized cooperation between large corporations. He openly called for collaboration in the automotive and IT sectors, urging big companies to unite in preparation for the Fourth Industrial Revolution.
That is indeed true.
Compared to foreign companies, our country’s large corporations have historically focused more on competition than cooperation. If shipping and shipbuilding had closely collaborated, the unprecedented bankruptcy of a national shipping company might have been avoided.
As soon as the president’s remarks ended, Im Seung-yong visited Eunsung Motor’s electric vehicle production line, and afterward had a separate meeting with Han Chan-young.
The Joongilbo published an article suggesting that Eunsung Motor and Seosung SB could collaborate under Im Seung-yong’s leadership.
I spoke with Yuri for the first time in a while.
Yuri greeted me with a delighted voice.
[You met my dad at the funeral home, right?]
“Yeah. We ran into each other by chance.”
[Why did you go there?]
“Taek-gyu wanted to eat yukgaejang.”
[Are you joking?]
“No, I’m serious.”
The yukgaejang was quite tasty.
[By the way, what’s up with Seosung SB?]
“There were some circumstances.”
Yuri, hearing my story, looked surprised.
[How does the senior not get involved at all?]
“…Yeah, that’s true.”
[I think the shareholders seem to favor Im Seung-yong.]
“That’s probably right.”
Eunsung Cha kept his comments indirect, but mentioned that they were discussing battery supplies with several companies and hinted at potential collaboration with Seosung SB.
Naturally, the shareholders welcomed this news warmly.
[What will you do? Do you have a plan?]
“I have something in mind.”
[Really? Can’t you share it just with me?]
“No. I can’t. It’s insider information.”
[Tch!]
I chuckled softly.
“You’ll find out tomorrow anyway.”
[Got it.]
“Speaking of which, next month will be the semester start.”
[That’s right. Many young freshmen will be coming in soon.]
“You’re still young, too.”
[Hey, I’m already a junior!]
She doesn’t seem to mind being called young, though. By the way, I’ve only attended up to the first semester of my sophomore year. When will I ever graduate?
[Let’s meet up before the semester starts.]
“Alright.”
***
Unlike Im Seung-yong, who only needs to focus on Seosung SB, Im Jin-yong has to consider the entire group and its subsidiaries.
The problem is that most of the major stakeholders in the subsidiaries are the National Pension Service.
If the group decides to defend its management rights, the National Pension Service won’t simply sit back. For Vice Chairman Im Jin-yong, it’s like facing a situation where he has to fight with his fists, even with a machine gun in hand. That’s probably why he pulled me into this game.
Given that I was going to help, I had no intention of being satisfied with just an 11 percent stake.
As electric cars sell well, battery manufacturers benefit. However, I can’t keep buying Seosung SB stocks that have already skyrocketed.
That’s why I made another proposal, and Vice Chairman Im Jin-yong accepted it.
“Taek-gyu said.
“Don’t you think we should get going?”
“Ah, I really don’t want to hold a press conference.”
The world is vast and filled with attention seekers, but I’m far removed from that. I’ve only held a press conference once, when I revealed my identity.
Since then, I’ve tried to avoid media exposure as much as possible.
However, to turn public opinion around, I need to show something on this side as well.
I made a phone call.
[This is Lee Su-hak.]
Lee Su-hak, the president of Seosung SB.
He has been by Chairman Im Il-Kwon’s side since his youth and is categorized as one of the closest associates to the founder, alongside Kim Myung-soo, who heads the Future Strategy Office.
“Are you ready?”
[Yes. We’re scheduled to leave for the Ceylon Hotel now.]
“Understood.”
After ending the call, I stood up.
“Let’s go.”
***
The Ceylon Hotel, located at the foot of Namsan.
A week before the shareholders’ meeting, I met with Lee Su-hak, the president of Seosung SB. Journalists were gathered in front of us.
In view of the reporters, we signed an MOU (Memorandum of Understanding) and shook hands.
“OTK Company and Seosung SB have agreed to jointly invest to establish a joint venture in the United States.”
The unexpected announcement surprised the journalists.
“What is the scale of the investment?”
“What will the contribution ratio be?”
“What is the purpose?”
I answered each of the reporters’ questions.
“The total investment amount is 5 billion dollars. OTK Company and Seosung SB will contribute in a 70:30 ratio. The purpose of establishing the joint venture is…”
I continued speaking while looking at the cameras.
“To build a battery factory in the United States.”
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