CH129 | Heir

Chairman Jang Young-joo cast aside his pride.

He believed that the only person who could save Hyundai Group now was Chairman Kim Tae-jung, so he humbled himself completely.

“Without Taewoo Group’s help, Hyundai Group won’t survive. Please, acquire Hyundai Semiconductor.”

“If it were just a matter of my feelings, of course, I’d do it. However, acquiring Hyundai Semiconductor could bring down Taewoo Group as well. I can’t let Taewoo collapse to save Hyundai. How could I possibly take on a company that carries a staggering 16 trillion won in debt?”

Hyundai Semiconductor’s financial state was disastrous.

It was only barely surviving thanks to emergency financial aid from the government and banks.

Chairman Jang had only recently come to fully grasp the severity of the situation.

"If you make the decision, I will personally persuade the creditors and the government. If we can negotiate a significant debt reduction, wouldn’t Taewoo Group be able to manage it?"

"If the creditors agree to a 25% repayment condition, I’ll consider acquiring Hyundai Semiconductor. But that’s a tough condition for them to accept."

25% of the debt.

This was not a decision Chairman Kim had made alone.

It had been carefully deliberated through long meetings with the vice chairman, Taewoo Securities, and the strategic planning office before settling on this condition for acquisition.

"That’s an unreasonable condition. No bank would accept such terms."

Lee Soo-hyun, president of Foreign Exchange Bank, immediately opposed it.

Foreign Exchange Bank was the largest creditor and major shareholder of Hyundai Semiconductor, which is why he had attended the Federation of Korean Industries (FKI) meeting as the creditors’ representative.

“Then I’ll appeal directly to the government. We need a solution that saves both Hyundai Group and the banks.”

“Even with government intervention, writing off 75% of the debt is nearly impossible.”

"But we can’t just let Hyundai Semiconductor collapse, can we? If that happens, the banks will be in trouble, too."

A chance to recover at least 25%.

With government aid and financial support from Hyundai Group, creditors could recoup at least half of their loans.

But if Hyundai Semiconductor truly collapsed?

Given that it was losing over 2 trillion won annually, even foreign companies were reluctant to acquire it.

If the creditors took over the company, they would be forced to absorb the massive losses.

"This isn’t a decision I can make alone. I’ll convene a creditors' meeting to discuss it."

“I’ll do my best to secure maximum government support. Hyundai Group will also do everything it can to raise funds.”

“If the negotiations turn out favorably, I will seriously reconsider the acquisition.”

Chairman Jang, despite his frail condition, grasped Chairman Kim’s hand.

A thin, lifeless hand devoid of strength.

Chairman Kim gently stroked his hand several times, offering reassurance.

* * *

Late that night

It was past 10 PM when Grandpa finally returned home.

The FKI meeting had clearly exhausted him, as his steps were slow and heavy.

“The meeting ran quite long. Did it go the way you hoped?”

“I’m not sure. Chairman Jang personally came to the meeting room to persuade the creditors, but whether they’ll agree to a 75% debt write-off remains uncertain.”

In negotiations, the key strategy is always to drive the price down.

Only then could you gain the upper hand and negotiate from a position of strength to secure a better deal.

“If the creditors agree to reduce the debt to the low 70% range, that’s when you should proceed with the acquisition.”

“Do you really think the banks would agree to such a large write-off?”

“They won’t have much of a choice. The creditors will try every means possible to sell Hyundai Semiconductor, but who would want to acquire a company drowning in debt? In the end, they’ll have no option but to take what they can—recovering even 30% of their loans would be their best bet.”

Banks were never an easy opponent.

They would exhaust every possible strategy to minimize their losses.

But in this case, they were running out of options. Eventually, the creditors would be the ones reaching out to us first.

“Hmm… If that’s how it plays out, this will take some time.”

“Time is on our side. The longer we wait, the worse their financials become.”

“But even if we acquire Hyundai Semiconductor, can we really manage it? The company is bleeding 2 trillion won in losses every year.”

“That level of loss is manageable. Besides, the company won’t remain in the red forever—we only need to hold out for a few years. We’ve already developed a strategy to turn things around.”

“Hearing that from you puts me at ease.”

The semiconductor industry had collapsed due to the IT bubble, but ultimately, those who endured the downturn always reaped the rewards.

And I had a plan to shorten the time we needed to endure.

“What about Hyundai Construction?”

“It will likely go to Chairman Jang Kyung-joon of Hyundai Motors. Chairman Go of CL Group initially opposed the idea, but with Chairman Jang Young-joo personally asking for his understanding, the acquisition should proceed smoothly.”

I hadn’t anticipated Chairman Jang Young-joo’s sudden reappearance.

Unexpected variables are rarely welcome, but this time, it worked in our favor.

“Chairman Jang personally untangled this complicated mess.”

“The poor man, suffering through all this in his twilight years… Tsk tsk. That’s why companies must stockpile cash. You never know when you’ll face a crisis like this.”

Grandfather had changed so much over the years.

Before the foreign exchange crisis, he firmly believed debt was a sign of capability and focused solely on aggressive expansion.

But now, he was even more cautious than I was.

“Hoarding too much cash comes with its own problems. That’s why I’m planning to buy back and retire company shares.”

“The president of Taewoo Securities mentioned something about that. Stock price stability is important, so I agreed, but make sure to keep a certain level of retained earnings.”

“Ideally, I’d like to use this opportunity to secure as much equity as possible. That way, external forces won’t be able to shake Taewoo Group.”

“Rather than that, wouldn’t it be wiser to finalize the inheritance process now? If we transfer the shares to you while the stock price is low, we can significantly reduce the inheritance tax.”

Inheritance tax was a major concern.

With a 50% tax rate, we would have to pay several trillion won in inheritance taxes.

“Once the news spreads that Taewoo Group is acquiring Hyundai Semiconductor, all our subsidiaries’ stock prices will drop. That would be the perfect time to proceed.”

“Haha, you ungrateful brat! No matter the situation, shouldn’t you at least say ‘thank you’ first?”

"I’m always grateful to have been born as your grandson."

"That’s the spirit. Then, we’ll proceed with the inheritance tax process first, and once that’s settled, we can begin the share buyback."

I simply responded with a smile.

No matter what I said now, I would only come across as a greedy grandson eyeing his grandfather’s wealth.

Just as the warm conversation continued, my grandfather cleared his throat and spoke in a low voice.

"Ahem… There is a way to significantly reduce the inheritance tax. If we establish a charitable foundation or acquire artwork as part of the inheritance, we could cut the tax burden by more than half. What do you think?"

"I’d rather not hold your hand and walk into prison, Grandpa. Paying a few trillion won in taxes is a much better option than spending one or two years behind bars. Money can always be earned again, but time is irreversible."

"Haha! Did you just say ‘only a few trillion’?"

"As your grandson, I should at least have that level of ambition, don’t you think?"

I had seen far too many business moguls end up behind bars over inheritance tax scandals.

It might not be a major issue now, but sooner or later, it would cause problems.

"You’re right. At my age, I can’t afford a stint in prison either. Still, I’ll look for every legal way to minimize the tax burden. While we may not have much choice regarding stock transfers, I’ll convert some of my cash holdings into real estate and pass it down that way. With property prices currently low, that should help reduce the inheritance tax a little."

"Thank you."

Honestly, I wanted to tell him not to worry so much.

After all, I had more wealth than my grandfather.

Compared to the funds managed by SAVE Investment, my grandfather’s fortune wasn’t particularly significant.

But how could I say that?

For the sake of his pride, I had to remain respectful and appreciative.

* * *

1st November

For the first time in a while, key figures had gathered in Captain Kang’s office.

Alongside Dimon, both Team Leader Han, who managed SAVE Investment, and David had flown into Korea.

"Hyundai Semiconductor’s situation is deteriorating by the day. The creditors are trying to sell it not only to the U.S., but also to Japan and China. However, there seems to be little interest. The few parties that have shown interest only want to buy it at a rock-bottom price."

"That’s to be expected. Who in their right mind would acquire a company that loses 2 trillion won annually?"

"SAVE Investment has been actively fueling the narrative. Rumors are spreading on Wall Street that acquiring Hyundai Semiconductor would be a financial disaster."

The rumors had originated from us.

Team Leader Han had leaked the information through SAVE Investment, and David, with his extensive connections, had ensured that the whispers spread like wildfire.

"You’re doing a great job. Ah! We also need to drive down the stock prices of all Taewoo Group subsidiaries."

"If SAVE Investment dumps its holdings in Taewoo Group all at once, the stock price will drop, but is there a particular reason to do that?"

"Because of the inheritance tax."

"…Understood. Just give the signal, and we’ll drive the stock price down."

Team Leader Han narrowed his eyes.

He looked as if he wanted to say, "The wealthy are always the greediest."

I deliberately turned my head away—only to meet eyes with David.

"Boss! You need to come to the U.S. soon."

"Is it because of the presidential election?"

The U.S. presidential election was scheduled for this week.

With the Democratic and Republican candidates neck and neck, no one could predict the outcome.

"If Bush wins, shouldn’t you personally congratulate him?"

"Of course. Set up the meeting."

"But what if Bush doesn’t win? Some polls show the Democrats leading, while others favor the Republicans. If Bush loses, both SAVE Investment and you could suffer setbacks."

"We’ll cross that bridge when we come to it."

I wasn’t worried at all.

After all, I already knew who would win.

Plus, with the substantial financial support I had provided, Bush’s chances of winning were even higher than before my regression.

"I’ll go ahead and schedule the meeting."

"And since I’ll be in the U.S. anyway, I might as well take care of another matter—I’m considering acquiring a stake in Qualcomm."

"You mean the semiconductor company that supplies chips for mobile phones? Their stock has been cut in half due to the IT bubble. Even now, it’s continuing to drop in real-time."

The IT bubble had caused Qualcomm’s stock to plunge by nearly 80%.

Based on my past life’s knowledge, it would continue to decline for the next two years.

But once the iPhone hit the market, its stock price would skyrocket.

Now was the perfect time to secure a stake.

And, more importantly, Qualcomm’s technology was crucial for revitalizing Hyundai Semiconductor.