InkBound
patreon
CH96 | Heir
🕑 Added 2025-04-09 02:14:18 +0000 UTCTaewoo Construction’s President/CEO, Jang Soo-young, was my grandfather’s right-hand man.
As one of the founding members of Taewoo Group, he wielded immense power within the company.
But that power dynamic had now been disrupted.
Not because I, the successor, had entered the group, but because other subsidiaries had either caught up to or surpassed Taewoo Construction in revenue.
Taewoo Electronics, Taewoo Motors, and even the joint venture refinery with Aramco—
Taewoo Construction was steadily being pushed further down the rankings, and to make matters worse, the financial crisis had struck.
This was why Jang Soo-young’s voice lacked any strength as he delivered his mid-year report.
"The real estate market is in dire straits. Sales have declined by approximately 38% compared to last year, which has led to a 30% drop in Taewoo Construction’s revenue. However, we are still consistently securing new contracts compared to other construction firms."
"Hmm, I understand that the construction market is struggling, but these numbers are still too poor. Other companies may be faltering because their parent corporations are unstable, but Taewoo Construction has the full support of Taewoo Group. If you're struggling even with that backing, what does that say?"
"The surge in exchange rates has caused raw material prices to skyrocket. Please consider this factor in our revenue decline."
To be fair, this wasn’t entirely Jang Soo-young’s fault.
Given the country’s economic situation, how could the construction industry possibly thrive?
But I didn’t defend him.
He may have been my grandfather’s right-hand man, but he wasn’t mine.
Besides, in my previous life, he had betrayed Taewoo Group to save himself.
"Hmm, among all our subsidiaries, Taewoo Construction is the only one operating at a loss. Are you simply going to keep draining the money earned by our other businesses?"
"If the economy recovers, we can bounce back at any time. Please just give us a little more time," Jang Soo-young said, bowing his head.
In the past, other subsidiary CEOs would have stepped in to defend him.
But now that he had drifted away from the center of power, no one was willing to speak on his behalf.
Perhaps frustrated by the situation, my grandfather turned to me with a question.
"As head of strategic planning, what do you think? Should we just sit back and watch Taewoo Construction struggle?"
"There is a way to increase Taewoo Construction’s revenue. In fact, there’s even a way to secure the number one ranking in the construction industry at once."
A construction company's ranking was determined by its contracting volume.
Two years ago, Taewoo Construction had ranked third. Last year, it had climbed to second place.
But it had yet to surpass the industry’s undisputed leader, Hyunjae Construction.
Now, the mere suggestion that there was a way to overtake Hyunjae Construction and seize the top spot piqued everyone’s interest.
Not only my grandfather but every CEO in the room was now fully focused on me.
"What’s the method?"
"We participate in government projects."
"Are you referring to highway or bridge construction projects?"
"Government projects have been suspended. How can the state initiate construction projects when it's on the brink of bankruptcy? It seems the Director still doesn’t fully understand the current state of the construction industry."
Jang Soo-young raised his voice.
He had been sitting there like a criminal, yet the moment he thought I had made a mistake, he pounced.
As expected, I needed to cut him off as soon as possible.
"Do you really think the government will halt infrastructure projects just because they lack funds? They have no choice but to proceed using private investment."
"I did hear that the Blue House is considering adopting the MRG model to encourage private investment."
MRG, or Minimum Revenue Guarantee, was a system where the government, unable to pay construction costs upfront, promised to guarantee a certain level of revenue—either through tolls or fixed annual payments—to private investors who covered the initial expenses.
Jang Soo-young was well aware of how the MRG model worked.
Determined to counter me, he raised his voice again.
"The MRG model has significant downsides. Since we, as the construction company, have to bear the initial investment costs, it requires massive capital. For a construction firm where cash flow is critical, this could be a fatal move. It could take over 30 years just to recover our investment."
"I understand your concerns, President Jang. However, we don’t necessarily have to provide the capital ourselves."
"You’re suggesting we find an investor?"
An investor would provide the funds, while Taewoo Construction would handle the construction.
Winning such contracts would naturally boost our ranking, making this a guaranteed win.
"Which bank would be willing to provide such a massive initial investment? That’s impossible. Even the banking sector is struggling with liquidity issues."
"Korean banks may be short on funds, but foreign banks aren’t. Especially Wall Street—they have an excess of capital right now."
I looked down at Jang Soo-young as I spoke.
My eyes conveyed the message: What you can’t do, I can accomplish with ease.
"Hmm, if things work out as you say, it would be ideal. But even if Wall Street firms enter the private investment sector, there’s no guarantee that Taewoo Construction will secure the contracts."
"I will make sure it happens. I’ll bring in Wall Street investment firms into private infrastructure projects and ensure that Taewoo Construction secures all the contracts."
"Hah, your confidence is impressive. Fine, go ahead and try."
With my grandfather’s approval, the decision was made.
At that moment, Jang Soo-young shot me a smirk.
He was convinced that securing an investor and winning the contracts would be impossible.
Of course, for him, it would be impossible.
But I had SAVE Investments on my side.
Why would I need to find an investor when I could be the investor myself?
And as for securing the contracts—since I would be the one providing the funds, the choice of construction company was entirely up to me.
***
I went to Captain Kang’s office.
As expected, Dimon was still using this space as his temporary office, planning and executing strategies for new corporate acquisitions and mergers.
“You must be struggling in such a cramped space. Just hold on a little longer.”
“I actually find this kind of work enjoyable.”
“Still, I didn’t bring you all the way from the U.S. just to have you handle back-office operations. Soon, Taewoo Group will entrust all newly acquired companies to an external consulting firm first.”
“I assume that means I’ll be the representative of that consulting firm. And I’ll be the one taking all the heat.”
Dimon caught on to my intentions immediately.
An external consulting firm—it sounded nice on paper.
But in reality, it meant having someone else handle all the restructuring and other controversial decisions on behalf of the group.
Dimon was undoubtedly the best person for the job.
And this was also the best way to keep Taewoo Group’s name out of the media spotlight.
“I feel bad for giving you such a difficult task.”
“There’s no need to apologize. As long as you keep the promise you made to me, I don’t mind handling even tougher assignments.”
I recalled the promise I had made to Dimon back then.
The promise to make him the head of the best bank in America.
I had never forgotten that promise, and whether Dimon liked it or not, I intended to put him in that position.
“Don’t worry about that. Within ten years, you’ll be there.”
“I heard that Sandy Weill is in the process of merging Travelers and Citigroup. He’ll likely succeed before the year ends and take the top position. That means it’s getting harder for you to fulfill that promise.”
“The higher one flies, the harder the fall. When he crashes, I’ll make sure you rise.”
Dimon responded with a thumbs-up.
He knew I wasn’t one to make empty promises.
“So, what’s the first task? I doubt I’ll be starting my consulting firm duties right away, so I assume you’ve brought me something else to work on?”
“Just a little something to kill time. The government is launching infrastructure projects through private investment. I plan to secure all of them through SAVE Investments. And I intend to push Taewoo Construction as the contractor for the projects.”
Dimon nodded as he listened.
Since the private investment model had already been widely used in the U.S., he was well-versed in the concept.
“The Korean government must be desperate for funds if they’re resorting to private investment. But to be honest, this could end up being a losing game. Do you really think there’s profit in developing Korea’s infrastructure?”
"The government is planning to use MRG to attract private investment projects."
"So, they’re guaranteeing revenue. In the long run, that means profit."
MRG was a system where the government guaranteed a certain level of revenue.
With that in place, Dimon quickly calculated that this was a risk-free deal.
"Your job will be negotiating with the government. They’ll likely propose a 30-year revenue guarantee, but wouldn’t we need at least 40 years to turn a real profit?"
"That won’t be difficult. From the Korean government’s perspective, they’re getting infrastructure built without spending a dime, so they’ll be inclined to agree to our terms."
"That’s why I said this was an easy task."
South Korea was at its worst economic state due to the financial crisis.
Naturally, any feasibility assessment for this project would be pessimistic.
Who would have predicted that Korea would recover rapidly and develop at an astonishing pace?
Certainly not the government.
Which meant we could negotiate under extremely favorable conditions.
"Negotiating is easy, but won’t there be issues if we push Taewoo Construction for the contract?"
"That’s something I’ve been thinking about as well."
"If we set the bid requirements to exclude companies with a debt ratio over 50%, then no other construction firm besides Taewoo Construction will even qualify."
"With the industry in a slump, most firms must be heavily in debt."
"The real issue is if it becomes known that SAVE Investment is under your control. That would cause problems. We need to form a consortium to handle this."
A consortium was essentially an alliance.
In construction bidding, it was common for multiple firms to participate together.
Large-scale construction projects often involved consortiums.
And since most participants in these consortiums were investment firms, we could hide SAVE Investment within it.
"How do you plan to structure this consortium? You’re not thinking of bringing in Wall Street firms, are you?"
"Mostly, we’ll include various paper companies and subsidiaries under SAVE Investment. But we do need one front-facing company to act as a shield."
"If all of our paper companies participate, how much can we split the shares?"
"We can divide it into portions under 7% each."
"So, in exchange for having a shield company, we’d be giving up 7% equity."
7%—not a bad deal.
It would not only serve as a shield but also help conceal SAVE Investment’s involvement. Giving up 7% of the profits was an acceptable trade-off.
"Quantum Fund would be a perfect front for this. You have a good relationship with them."
"Looks like it’s time to give George a call. If I tell him he only needs to invest 7% of the total construction cost, he won’t refuse."
"If you ask him to join, George will definitely agree."
"And if we name the consortium Quantum Consortium, he’ll be even more eager."
George was the most well-known figure on Wall Street, and Quantum Fund was its most famous hedge fund.
From the British pound crisis to battles with the German, French, Japanese, and Korean markets—
He was a force that dictated Wall Street’s movements.
Using Quantum Fund’s name would also make government negotiations significantly smoother.
