InkBound
patreon
CH232 | GSI
🕑 Added 2025-03-19 04:25:15 +0000 UTCA heavy silence filled the study as Chairman Woo Yong-gap sat with a cigarette between his lips, his expression stiff and unreadable.
After a moment, he turned his gaze toward his son, who had just dropped an unexpected bombshell, and spoke in a subdued voice.
“So, you’re saying we should take over Mido Department Store through a hostile acquisition?”
Woo Ho-geun leaned forward and replied, “Yes. As outlined in the report, the Daheung Group’s owner family holds only 19.6% of Mido Department Store’s shares.”
“……”
“While it’s natural for an owner's stake to decrease as a company expands, this percentage is exceptionally low.”
It was common in South Korea for conglomerate families to maintain control over vast business empires through circular shareholding, even with relatively small stakes.
However, as Woo Ho-geun pointed out, the Daheung Group's ownership of Mido Department Store was unusually low, even by those standards.
“Moreover, considering that Mido Department Store serves as the group's primary cash flow source and a key pillar in its circular shareholding structure, their stake is shockingly inadequate.”
“Even if their direct holdings are small, wouldn’t their stake increase when combined with affiliated companies and friendly shares?”
Without hesitation, Woo Ho-geun responded confidently, “Even when everything is combined, it doesn’t even reach 30%.”
“Are you saying that’s all they have?”
Chairman Woo furrowed his brows in disbelief.
“Yes. I was just as shocked when I investigated it. Their governance structure is so weak that it’s almost hard to believe.”
“Hm…”
Chairman Woo let out a low hum, crossing his arms while holding his cigarette between his fingers. Woo Ho-geun took this as his cue to continue.
“Hostile takeovers have never been attempted in Korea before. So, in a way, I can understand why they’ve been complacent.”
Exhaling a thick cloud of white smoke, Chairman Woo spoke gravely.
“As you said, there’s a reason such a thing has never happened here.”
“You’re referring to the unspoken agreement among business owners.”
Chairman Woo gave a small nod.
“Yes. There are unwritten rules and an order that everyone abides by. Breaking them would lead to condemnation and isolation from the business community.”
Despite his father’s stern expression, Woo Ho-geun remained composed as he replied, “That’s true. But if the potential gains from a hostile takeover outweigh those consequences, isn’t it worth considering?”
“What do you mean by that?”
Chairman Woo narrowed his eyes, and Woo Ho-geun responded with a knowing smile.
“You know that the two core pillars of Daheung Group are Mido Department Store and Daheung Textile.”
Chairman Woo gave a small nod, prompting Woo Ho-geun to continue.
“At the top sits Chairman Park Tae-hong, and beneath him, the conglomerate is structured like a pyramid, with its key subsidiaries in retail and textile manufacturing overseeing numerous smaller affiliates.”
“That’s not unusual. Most conglomerates are structured that way.”
“Of course.”
Even Donghae Group, which Chairman Woo led, was structured similarly, with its holding company, Donghae Oil, at the center of a pyramid-like ownership structure.
“But there’s one fatal weakness in Daheung Group’s governance structure.”
“A weakness?”
Before he realized it, Chairman Woo Yong-gap had leaned forward, intrigued.
“Yes. The key point is that Mido Department Store is the largest shareholder of Daheung Textile, holding a substantial 32.8% stake.”
“……!”
“In other words, acquiring Mido Department Store means we can take over the entire Daheung Group.”
The unexpected revelation made Chairman Woo’s eyes widen. Without thinking, he swallowed dryly.
This wasn’t just about some minor company—Daheung Group was a conglomerate ranked among the top 50 in the business world. It was a game-changing opportunity.
“If we successfully absorb Daheung Group, our size will expand significantly, allowing us to break into the top 30 rankings.”
Breaking into the top 30 wasn’t just about climbing the rankings—it meant being recognized as one of the country’s elite conglomerates.
Naturally, the prestige and influence that came with such status were immense. For instance, at national events or meetings between the president and corporate leaders, invitations were typically extended to the top 30 groups.
Chairman Woo had long harbored ambitions of elevating his company into that exclusive circle.
A hostile takeover would undoubtedly draw severe backlash and criticism from the business community, where such moves were considered taboo.
However, the potential rewards were far too tempting to simply walk away.
After a long moment of contemplation, Chairman Woo found himself unable to resist the lure. His gaze darkened as he looked at his son and asked,
“So, what exactly is your plan?”
A deep smile played on Woo Ho-geun’s lips as he confidently laid out his strategy.
“It’s quite simple. We secure a 50%+1 shareholding in Mido Department Store, convene an emergency board meeting, dismiss the current management, and take control.”
Chairman Woo frowned. For all his son’s confidence, the plan seemed almost too straightforward.
“Chairman Park isn’t a fool. The moment we start acquiring shares, he’ll notice and take countermeasures. What then?”
Woo Ho-geun, unfazed, responded with ease.
“Of course. But we’ll use Donghae Peregrine Securities as a front, making it appear as a foreign investment. Meanwhile, we’ll have our allied entities discreetly acquire shares on our behalf. That way, they won’t suspect us immediately.”
His voice carried the certainty of someone who had meticulously refined this plan in his mind countless times.
“By the time they sense that something’s off, we’ll have already secured a significant stake. At that point, even if they see what’s happening, they’ll be powerless to stop it.”
As the cigarette burned almost to the filter, Chairman Woo Yong-gap ground it out in the crystal ashtray and spoke.
“I’m not sure if such an obvious tactic will be enough to deceive Daheung Group.”
“The law allows foreign investors to acquire up to 15% of domestic companies, and with foreign investment actively flowing into the stock market, even if we start accumulating shares, they won’t immediately find it suspicious.”
“Hm. Even Donghae Yuryang has its foreign ownership maxed out at 15%.”
At Chairman Woo’s nod, Woo Ho-geun agreed.
“The same applies to other conglomerates, so Daheung Group likely won’t raise any major concerns either. Before we exceed the 15% limit, we’ll transfer the shares to ourselves or trusted allies, ensuring they remain unaware for as long as possible.”
Woo Ho-geun, his expression serious, locked eyes with his father and asserted firmly.
“As you mentioned, a hostile takeover has never been attempted in Korea. Even if their stock price rises and share movements occur, it will take them quite some time to realize our true intent.”
“That’s likely.”
After all, before hearing this plan, Chairman Woo hadn’t even considered the possibility of a hostile takeover himself.
“While they scramble in confusion, we’ll tighten the noose and seize control. This is a battle we cannot lose.”
Leaning forward, Woo Ho-geun pressed his case.
“We have a feast laid out before us. If we let this opportunity slip through our fingers, we’ll regret it for the rest of our lives.”
“……”
Chairman Woo tapped the armrest of his sofa with his fingers, lost in deep thought.
“How much capital do you estimate we’ll need to acquire Mido Department Store’s shares?”
“Around 300 billion won should be enough to secure a majority stake.”
As expected, the hefty sum made Chairman Woo’s expression tighten.
“To raise that amount, we’d have to scrape together every bit of spare cash the group has.”
Lowering his voice, Woo Ho-geun subtly suggested,
“There’s no need for that. We have idle funds sitting in the safe.”
“Idle funds? Don’t tell me you’re referring to the CDs left in our care by the in-laws.”
Chairman Woo’s face darkened as he shot his son a sharp look.
“They’re no longer in-laws. Seo-ah has already divorced her husband. And with the slush fund scandal, former President Noh’s camp isn’t in a position to demand the CDs back. That money is as good as unclaimed.”
“Drop it. Don’t be greedy.”
Chairman Woo’s voice was firm, his expression sour.
“Even if he’s a toothless tiger now, a predator is still a predator. If he mobilizes the connections he still has in politics and government, it could become a major headache.”
“Then we just borrow it temporarily and replenish it later.”
“……”
“They aren’t leaving that slush fund untouched out of goodwill toward us. They simply can’t touch it because the prosecution is breathing down their necks, investigating every corner.”
Indeed, when the slush fund scandal broke, both Chairman Woo Yong-gap and Chairman Moon Byung-kwon of ST Group, once in-laws, had been the first to be summoned by prosecutors under suspicion of helping to hide the funds.
Chairman Woo had insisted during questioning that he had never received any special treatment—on the contrary, he claimed, their in-law relationship had only brought him unnecessary trouble. He vehemently denied ever holding onto hidden funds.
However, in reality, he was safeguarding a staggering 100 billion won in slush funds, all stored as cash and certificates of deposit (CDs), allowing him to evade prosecution.
“Even banks charge interest. Think of it as borrowing the money in exchange for safekeeping it.”
Despite his son’s persistent persuasion, Chairman Woo couldn’t make up his mind. Deep wrinkles formed between his brows as he struggled with the decision.
Former President Noh was a concern, but what troubled him even more was the possibility of rekindling the slush fund investigation, which had seemingly been put to rest after the imprisonment of two former presidents.
‘That must never happen.’
However, the thought of letting this opportunity slip away was unbearable. Mido Department Store—no, the entire Daheung Group—was too tempting a prize.
After much deliberation, Chairman Woo Yong-gap finally made up his mind. His expression hardened as he spoke firmly.
“We need to make sure there are no loose ends for the prosecution to follow. The laundering must be airtight.”
At last, he had given his approval. Woo Ho-geun flashed a wide grin.
“Don’t worry. We’ll disguise it as capital flowing in from Hong Kong through Peregrine Securities, which is working with us. No one will suspect a thing.”
Seeing that his son had already devised a way to conceal the source of funds, Chairman Woo nodded in approval.
“Have you decided where to place the friendly shares?”
“I’m considering Baekje Industries.”
“A solid choice. When it comes to critical matters like this, family is the only one you can truly trust.”
Baekje Industries was owned by his wife’s family, making it, in a way, a family business.
“I’ll assign Chief Secretary Jeon to assist you. Work with him and push this forward.”
At the mention of Jeon Hae-cheol, Chairman Woo’s most trusted aide, Woo Ho-geun hesitated for a moment.
It felt as if his father didn’t fully trust him and was placing a watchdog to keep an eye on him.
Still, he suppressed his discomfort and bowed his head in response.
“Understood.”
After discussing the details for a while longer, Woo Ho-geun finally left the study.
Now alone, Chairman Woo picked up the file in front of him and flipped through the pages once more.
“To think he’d come up with something like this… It seems his time in Hong Kong wasn’t just wasted.”
The son who had once been nothing but trouble was finally proving to be useful.
“If this all goes according to plan…”
As the thought of swallowing Daheung Group whole took hold, his eyes gleamed with insatiable greed.
