InkBound
patreon
CH255 | GSI
🕑 Added 2025-03-27 01:55:39 +0000 UTCHanyang Country Club, Goyang, Gyeonggi Province
Located just 30 minutes from Seoul, the club's convenient location meant that even on a weekday afternoon, many people were out enjoying a round of golf under the warm spring sunshine.
On the lush green practice putting area beneath tall pine trees, men and women dressed in colorful golf attire were refining their strokes. Meanwhile, a distinguished group of individuals made their way into the elegantly designed clubhouse.
Leading the group were Kwak Dong-hoon, chairman of Saseong Group, and Jung Tae-ho, chairman of Hyunwoo Group—two of the most powerful figures in the corporate world, constantly vying for the top spot in the business rankings.
"Your shots were excellent today. Even at your age, your driving distance hasn’t diminished at all—it's truly impressive."
At this, Jung Tae-ho, who was well into his eighties and dressed in a purple polo shirt and white vest, let out a hearty laugh.
"Haven’t you heard? Life begins at eighty. I can still take on two or three young men without breaking a sweat."
"Wasn’t it supposed to be sixty, not eighty?"
Kwak Dong-hoon, dressed in a white cap and charcoal-gray pants, countered with a grin. Jung playfully clicked his tongue.
"Ah, come on. Just let it slide instead of nitpicking over details."
"Hahaha. My mistake. From today onward, let’s say it’s eighty, not sixty."
Kwak’s playful response earned a chuckle from Jung, who gave him a light pat on the back.
Though they were competitors battling for the number one spot in the business world, their camaraderie was undeniable. Yet, despite their casual banter, Kwak maintained a respectful demeanor toward Jung—understandable given their significant age difference. In fact, Jung’s second son was older than Kwak, making their relationship almost that of a father and son.
Still chatting amicably, the two men made their way to a private lounge within the clubhouse—a secluded space designed for VIPs seeking a quiet retreat, away from prying eyes. The room featured a plush carpet, a round table, and an array of antique ceramics and landscape paintings that added a refined touch. A large glass wall offered a sweeping view of the expansive golf course, further enhancing the sense of openness.
Once seated across from each other, a uniformed female staff member approached and set down a menu.
"What would you like to order?"
Familiar with the establishment, Jung Tae-ho didn’t even glance at the menu before responding.
"I’ll have the soft tofu stew."
"Then I’ll go with the clam and mugwort soup."
Kwak Dong-hoon, also well-acquainted with the menu, gave it a cursory glance before making his selection.
"Got it. I’ll bring them out shortly."
As the staff member left the room, Kwak took off his cap and set it aside. He stole a sidelong glance at Jung Tae-ho, who, as if out of habit, was already placing a cigarette between his lips.
Then, casually, Kwak broached the hottest topic in the corporate world at the moment.
"I assume you've heard about Daehung and Donghae battling over shares in Mido Department Store?"
"Of course. This entire week, that’s all anyone’s been talking about. How could I not know?"
Jung Tae-ho lit his cigarette with a flick of his lighter and took a drag before responding.
"Daehung countered the public tender offer, so Donghae immediately raised its purchase price to 70,000 won per share."
Jung clicked his tongue in disapproval.
"A stock that wasn’t even worth 10,000 won suddenly selling for seven times its price? That’s madness."
As he shook his head in disbelief, Kwak Dong-hoon leaned forward slightly.
"If we’re only talking about Mido Department Store, then yes, the price is outrageous. But if acquiring Daehung Group as a whole comes as part of the deal, then it’s a different story, wouldn’t you say?"
Jung exhaled a thin stream of smoke, his expression sour.
"Even so, Chairman Woo has gotten too greedy this time. There’s always been an unspoken rule in the business world—if someone crosses the line like this, who’s going to respect those rules anymore?"
"You’re absolutely right. There’s no denying that Donghae Group is overstepping here."
"Just when the slush fund scandal was starting to quiet down, something like this happens. Tsk."
Jung tapped the ash off his cigarette into a crystal ashtray before turning his gaze to Kwak.
"So, who do you think will win this fight?"
"Well..."
Kwak picked up his glass of mineral water, taking a moment to gather his thoughts before responding.
"Even with its friendly shares included, Daehung Group’s stake is simply too low. On top of that, they poured all their available cash into acquiring and developing the Gangnam store site, so their liquidity is practically drained. Given all that, wouldn’t you say Chairman Woo has the upper hand?"
"I think so too. You have to admit, Donghae struck at Daehung’s weakest moment with impeccable timing."
"Exactly. That’s why, despite the lingering fallout from the slush fund scandal, they made this aggressive move to acquire Mido Department Store."
"Yes, that’s right."
Jung nodded slightly.
"If Donghae actually manages to take over Daehung, their ranking in the corporate hierarchy will see a significant jump."
"It might not be enough to break into the top ten conglomerates, but they’ll definitely secure a spot in the top twenty."
"The market conditions haven’t been favorable lately, and they’ve been struggling. But considering Donghae owns several highly profitable subsidiaries—like Bangjik, the industry leader, and the recently acquired securities firm that’s already turning a profit—it’s definitely possible."
Leaning back in his chair, Jung flicked his cigarette between his fingers before speaking again.
"You’re aware of how concerned the other business leaders are about this situation, right?"
Kwak, his expression now more serious, nodded.
"If Donghae successfully seizes control of Mido Department Store, it sets a dangerous precedent. Other groups could face similar hostile takeovers, so it’s only natural for them to be on high alert."
"Exactly. If they’re not careful, they could watch helplessly as their hard-built companies get stolen right from under them. Who could possibly feel at ease?"
Jung’s concern was not without reason. Like Hyunwoo Group, Saseong Group was also controlled by its founding family, despite the family holding only a small percentage of the total shares. Kwak understood the implications all too well and nodded in agreement.
Just then, Jung’s expression hardened with clear dissatisfaction.
"To be honest, we never wanted to take our companies public in the first place."
Kwak let out a dry chuckle, sensing the frustration behind Jung’s words.
"You’re referring to the Special Measures of May 29, aren’t you?"
"That’s right. I don’t care how authoritarian the military regime was—forcing privately owned companies to go public at dirt-cheap valuations? It still infuriates me just thinking about it."
Jung downed a large gulp of water, as if trying to cool his rising temper.
"The government mandated that when setting the IPO price, it couldn’t exceed the stock’s face value. And they forced us to lower our major shareholders’ stake below 51%, isn’t that right?"
"That's right. Back then, it was common practice to set the par value of a stock at 500 won per share. But the government demanded we go public at a price even lower than that—who in their right mind would agree to such nonsense?"
Jung Tae-ho set his glass down with a sharp clack, his irritation evident.
"If we followed the government’s orders, we would have had to list stocks that were trading at 2,000 to 3,000 won in the over-the-counter market for not even half that price."
"Selling shares at rock-bottom prices was frustrating enough, but being forced to release additional shares just to meet the major shareholder equity requirements? That was infuriating."
At the time, only a handful of companies were listed on the exchange, and trading volumes were a fraction of what they are today.
Moreover, there was little incentive to go public since businesses could easily secure low-interest loans from banks thanks to government economic policies.
But the biggest concern of all was the weakening of ownership control due to declining equity stakes.
Eventually, however, mounting government pressure led companies to cave one by one. As a result, the number of listed stocks in Korea surged from just 50 in 1971 to 128 within three years, establishing a more structured stock market.
"Still, while other companies surrendered early and went public, Hyunwoo Construction held out until the new military regime came to power before finally listing its shares."
It was meant to be a reassuring comment, but Jung merely scoffed, his brow furrowing.
"And what good did that do? Even after holding out, we barely got a 70% premium on the 500-won par value, listing at a measly 850 won per share. When you consider that Hyunwoo Construction stock was trading at 3,500, even 4,000 won in the OTC market, it was practically a giveaway. A giveaway!"
Seeing Jung grumble in frustration, Kwak Dong-hoon recalled the situation back then.
"That’s why the subscription competition was over ten-to-one, wasn’t it?"
"Of course. Anyone who got shares in the public offering could make four to five times their money instantly. Just thinking about it still makes my stomach turn."
Jung scowled and took another deep drag from his cigarette.
Back in the 1980s, Hyunwoo Construction was one of Korea’s premier blue-chip companies, much like Saseong Electronics would later become.
As expected, the stock skyrocketed upon listing, making a fortune for those lucky enough to subscribe.
Just then, a knock on the door was followed by two female staff members entering, wheeling in a serving tray with their ordered meals. After placing the dishes on the table, they quietly exited the room.
The rich, spicy aroma of sundubu jjigae (soft tofu stew) filled the air, making Jung put out his cigarette in the ashtray.
Seated across from him, Kwak picked up his spoon and resumed their conversation.
"As you said, going public came with many disadvantages. And if this situation gets out of hand, hostile takeovers purely for the sake of seizing management rights could start happening unchecked in Korea as well."
"It’s inevitable. The first time is always the hardest—once the precedent is set, it’ll only get easier from there."
It was the same principle as a spotless street—once a single piece of trash is dropped, it doesn’t take long for the whole place to get littered.
Kwak, picking at his sigumchi namul (seasoned spinach) sprinkled with sesame seeds, set down his chopsticks and spoke in a more serious tone.
"That’s why I wanted to bring up the idea of having the Federation of Korean Industries (FKI) step in to mediate this situation."
"Are you suggesting we get involved in the equity battle?"
"Not directly, of course. But we could provide financial support to Daehung Group and help level the playing field."
"Hmm..."
Jung Tae-ho crossed his arms, deep in thought.
"At the same time, if we stir up public opinion against Donghae Group for attempting to bring in foreign investors to acquire a domestic company, Chairman Woo may find it difficult to continue pushing forward with his ambitions."
Jung Tae-ho nodded in agreement.
"You're right. This isn’t something we can just sit back and watch from the sidelines."
"Exactly. To prevent something like this from happening again, I believe the business community must present a united front."
Kwak Dong-hoon’s voice carried conviction, and Jung Tae-ho, never one to hesitate once his mind was made up, reached his decision without much deliberation.
"I agree. If Daehung needs financial support, I’ll contribute 10 billion won."
Jung was known for his decisive nature—once he made up his mind, he acted swiftly.
Hearing this, Kwak Dong-hoon’s face lit up.
"If Chairman Jung takes the lead, I’m sure others will readily follow suit."
Jung let out a wry smile and spoke in a matter-of-fact tone.
"They’re probably already worried that their own management rights could be at risk next. I’d bet they’ll be rolling up their sleeves in no time."
