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CH146 | GSI
🕑 Added 2025-02-19 03:30:01 +0000 UTC“Did you just say this is an affiliate restructuring plan?”
“Yes.”
Chairman Park Tae-hong gave a small nod and spoke calmly.
“I plan to weed out and liquidate the unprofitable affiliates that have failed to escape deficits despite continuous investments.”
“Why did you suddenly decide on that?”
“You were the one who said there were too many unprofitable affiliates that weren't delivering proper results and were just dead weight.”
“Well, that's true, but…”
Seok-won had indeed given urgent advice to help them safely navigate the imminent IMF crisis, but he hadn't expected such a bold decision. Internally, he felt a slight sense of surprise.
‘Besides, it was my father himself who greatly expanded the affiliates in pursuit of business diversification, so making this decision must have been even harder for him. This is really unexpected.’
Liquidating the failing affiliates was practically an admission that Chairman Park Tae-hong’s business diversification efforts had not been successful.
As Seok-won carefully observed his father’s expression, Chairman Park spoke in a calm and composed manner, showing no change in emotion.
“When I carefully reflected on what you said, I realized that I had been stubbornly holding onto companies that should have been shut down long ago, purely out of pride and obstinacy.”
Hearing his father’s self-deprecating words, Seok-won quickly spoke up.
“Attempting business diversification wasn’t a wrong decision. Given how heavily the company was focused on textiles and department stores, no one can deny that expanding into new industries was necessary for the group’s long-term growth.”
At that, Chairman Park gave a bitter smile and said,
“The decision itself may not have been wrong, but the outcome was a deficit, so it was a failure.”
Seok-won fell silent, unable to refute the statement.
“A misjudgment was made, but as long as I acknowledge it and correct it now, it’s not too late, is it?”
Many had doomed themselves by refusing to admit failure and clinging to their arrogance and stubbornness. In that sense, Chairman Park's decision was wise and courageous.
“Enough of this heavy talk. I plan to streamline operations while keeping textiles and retail as the two main pillars of our business. Take a look and tell me what you think.”
Then, as if making a point, he added,
“If nothing else, you do have a good eye for business, don’t you?”
“Not just a good eye—an excellent one.”
With a smirk, Seok-won raised one corner of his mouth confidently, prompting Chairman Park to click his tongue.
“Did you already forget what I said earlier about being humble?”
Still, he couldn't deny that his son had a sharp business acumen.
Although Seok-won seemed to be growing more cheeky, his abilities were undeniable.
Picking up the file in front of him, Seok-won carefully read through its contents.
Watching him, Chairman Park took a sip of warm coffee, waiting patiently for him to finish reviewing the plan.
After some time had passed, Seok-won closed the file and looked up.
“What do you think?” Chairman Park asked.
Seok-won turned to him, unable to hide his surprise.
“If we proceed according to this plan, we’ll be selling off or liquidating more than half of our 23 affiliates—15 in total. Are you really going through with this?”
“Once I’ve decided on restructuring, I need to cut off the dead weight. If a branch is rotten, it doesn’t matter if it’s 15 or more—I’ll prune them all.”
“With fewer affiliates, the overall scale of the group will shrink significantly. Our ranking in the business world might also drop.”
For conglomerate chairmen, corporate rankings were almost a matter of pride.
As expected, Chairman Park’s eyes wavered slightly, but he quickly regained his composure and spoke firmly.
“Rather than a flashy but hollow company, it’s far better to build one with solid fundamentals.”
Seeing his father’s firm resolve to reform the company, Seok-won nodded slightly, feeling encouraged.
“You’re absolutely right. No matter how high our ranking is, if the foundation is rotting, it’s nothing more than a sandcastle waiting to collapse.”
“Exactly.”
Seok-won glanced at the file again and commented,
“I don’t know who drafted this, but it looks like a well-thought-out plan.”
“Your brother will be pleased to hear that.”
Seok-won’s eyes widened in surprise.
“My brother made this?”
“Yes.”
“I thought it was quite a bold plan… That makes sense now.”
If Secretary-General Gil Sung-ho or other executives had been in charge, they would have found it difficult to come up with such a drastic proposal to cut half the affiliates.
‘This proves that my words last time didn’t just go in one ear and out the other.’
It was reassuring to know that both Chairman Park Tae-hong and his brother, President Park Jin-hyung, had recognized the growing financial instability of the group.
‘This won’t be enough to weather the full force of the IMF crisis unscathed, but at least we’re taking some precautions.’
Just the effort to reduce debt instead of increasing it was already a significant step forward.
Clearing his thoughts, Seok-won spoke.
“This plan is solid, but there’s one affiliate I think would be a waste to let go.”
“Which one?”
“Daeheung Line.”
Chairman Park Tae-hong furrowed his brow as he looked at his second son.
“Isn’t Daeheung Line the company handling small parcel deliveries within the group?”
“That’s right.”
“And you’re saying we shouldn’t sell it?”
“Yes.”
Looking unconvinced, Chairman Park tilted his head.
“It’s just a minor company handling home deliveries for our department stores and corporate telemarketing sales. What makes you think it’s too valuable to get rid of?”
Leaning forward, Seok-won earnestly explained.
“All consumer goods go through logistics processes such as transportation, storage, processing, loading, and packaging before reaching the final buyer. In a way, logistics is like the circulatory system in a human body—it ensures that everything flows smoothly.”
Seeing his father sitting with his arms crossed, quietly listening, Seok-won continued.
“Even now, Daeheung Line is handling logistics not only for the department store but for the entire group, ensuring that all affiliates function smoothly—like a well-oiled machine.”
“That may be true, but most of its revenue comes from internal contracts. At this rate, there’s a clear limit to its growth. While it isn’t operating at a loss, it’s not generating significant profits either. Considering the effort and costs involved, keeping it might actually be a burden. Instead of holding onto it as an affiliate, selling it off and outsourcing logistics externally would be more beneficial.”
“I see it differently.”
Seok-won spoke calmly as Chairman Park Tae-hong furrowed his brows.
“In the upcoming Fourth Industrial Revolution, the number of consumers purchasing products online, not just in physical stores, will skyrocket.”
Since the internet was not yet widespread, Chairman Park’s frown deepened at the unfamiliar term.
“Online? What’s that?”
“Simply put, it refers to being connected to the internet. Just as a telephone line allows people to communicate across distances, a computer connects to a vast network called the internet. Being connected is called being ‘online,’ whereas the real world, without internet access, is referred to as ‘offline.’”
Despite Seok-won’s enthusiastic explanation, Chairman Park still seemed puzzled.
Seeing his father’s face full of question marks, Seok-won felt as if he had become a digital literacy instructor.
Suppressing his frustration, he elaborated further.
“When the internet becomes widespread, a new market for online shopping will naturally emerge and grow explosively. People will be able to browse, compare, and purchase items from home without ever stepping outside.”
“……”
“And when that happens, the small parcel delivery business—responsible for getting those online purchases to customers’ doorsteps—will become an incredibly important and highly valuable industry.”
Chairman Park finally seemed to grasp the basic concept, though his expression remained skeptical.
“Online shopping, huh… Do you really think that kind of world will exist?”
“Yes. And not in some distant future—it’ll become an essential part of everyday life very soon.”
Seok-won nodded with confidence.
Even so, Chairman Park still found it hard to believe.
From his perspective, all this talk about “online” seemed like nothing more than wishful thinking.
So what? That was his real sentiment.
After all, not everything in the world unfolds according to predictions.
However, knowing that Seok-won had a keen business sense, a small part of him started to wonder—what if?
‘If things really turn out that way, selling off Daeheung Line would be like mistaking a swan for an ugly duckling and letting it go for a pittance.’
That would be a decision he’d regret for years to come.
After reaching that conclusion, Chairman Park made up his mind.
“I don’t know if this ‘online shopping’ thing will actually take off, but since small parcel delivery is still essential to the group, I’ll go along with what you’re saying. Besides, as long as the company isn’t losing money, keeping it won’t cause any major issues.”
“That’s a wise decision.”
Seok-won smiled.
“In the future, you’ll look back on this as one of the best choices you’ve made.”
“I sure hope so.”
Chairman Park replied indifferently before smoothly changing the subject.
“The investment profits from our stock holdings—those are still sitting in the account as cash, right?”
“Yes.”
“I’ll need to withdraw some of that.”
“If you’d like, I can transfer the money as early as tomorrow.”
Chairman Park Tae-hong looked at his second son with a hint of surprise.
“When someone’s about to withdraw a large sum, isn’t it normal to try and stop them first?”
“Well, it’s your money. I have no right to stop you.”
Seok-won shrugged nonchalantly.
“Besides, you must have a reason for withdrawing it, right?”
“You’re not wrong, but for some reason, this feels oddly disappointing.”
Chairman Park had expected at least a bit of reluctance or concern. But Seok-won’s indifference made him feel slightly let down.
“There’s no issue with the fund’s operation even if you withdraw some of the money.”
At that, Chairman Park frowned.
In reality, thanks to Seok-won’s investments in Ogwang Industries and Cheonho Steel, the private equity fund had grown exponentially, yielding over tenfold returns. Even after deducting Seok-won’s bonus and management fees, the fund had swelled to several hundred billion won.
Although it was labeled as a private equity fund, the only investors were Chairman Park and Seok-won.
However, since Seok-won had funneled the money through an anonymous offshore account, neither Chairman Park nor Ko Young-il, the CEO of Daeheung Securities, was aware that the funds technically belonged to Seok-won.
So, if Chairman Park withdrew his share, it made no difference to Seok-won.
In fact, Chairman Park, who hadn’t expected such astronomical returns, was the one who would regret pulling out.
But since he had a specific purpose for the funds, all he could do was click his tongue in mild regret.
“Tomorrow, Secretary Gil will give you the department store’s corporate account details. Transfer the money there.”
Realizing where the money was going, Seok-won immediately asked,
“You’re using it for the Sampoong Department Store land acquisition?”
“Yes. The bank has agreed to provide a mortgage loan, but to compete against Lotte and Utopia in the bidding, we need to secure ample capital.”
“That’s probably a wise move.”
The best option would be to avoid the bid altogether, but since Chairman Park was set on it, that wasn’t an option.
In that case, minimizing loans while securing the land would be the best strategy.
‘And if you’re going to bid, you might as well win.’
As long as they could weather the looming IMF crisis, securing the prime real estate of Sampoong Department Store in the heart of Gangnam would be a guaranteed jackpot.
