Investor Qualities
The day after the news of SS Partners’ purchase of Daeyang Heavy Industries’ stock was announced, the owner’s family again gathered at the chairman’s house to watch the stock price nervously.
The stock price of Daeyang Heavy Industries, which closed at the high the previous day, began to rise sharply as soon as the market started on the same day.
“Damn it!”
Among the brothers, the eldest son, who is the most urgent and rough, swears.
“You knew this. Let’s not lose weight from the beginning.”
My younger brother, Ryu Geun-il, said a word from the side.
“Be quiet.”
Chairman Ryu couldn’t afford to watch over the nerves of his two sons.
“How about you? Do you think it will be the same today?”
Chairman Ryu said while looking at Chief of Staff Oh Kyung-deok.
“yes. It may go back up to the upper limit, but at least it doesn’t look like it’s going to go lower than it is now.”
“Then I have to take action now.”
“Kang Yu-jin is also Kang Yu-jin, but I think we need to take measures against short selling.”
“How is the short selling situation?”
“A large part of it was put in through Daeyang Securities. That will be a cover somehow. But the other side is not easy to turn around when problems arise. It was put in while hiding our identity, so we can’t put pressure on it.”
“Still, the selling price can afford it, so can’t we just watch it a little more?”
Ryu Geun-il, who still had regrets, said.
“The average unit price for short selling is around 45,000 won. If you increase by 9,000 won from the current price, you will start to lose money.”
“Can’t you just hold on to it? No matter how many days you set the upper limit and a riot, it will eventually fall.”
“These days are a problem. After hitting the cap a few times, you will be asked for a significant amount of additional margin. If you don’t pay the margin, it will go into liquidation.”
“I wish I could go that far.”
“The possibilities are endless. We have to be prepared in case it happens.”
“At a time like this, there should have been Sunggyu’s child. I don’t know anything else, but this one was very clever.”
The eldest son said he felt sorry for him.
“Don’t say anything useless. Who created this Satan? ttt!”
Ryu Geun-il clicked his tongue and said.
“Then let’s just deal with some of them first.”
The president looked at his two sons with disapproving eyes.
Both were too greedy, which was the problem. In times like these, we need the wisdom to take a step back, but neither can give up what we have.
If it is a growing company, it will be an advantage, but now is the time to think about Mercury.
In that respect, the third one was the best. The same goes for my grandson, Sunggyu.
The old man thought that he would have to reconsider the composition once the situation calmed down.
A person’s true worth is revealed in a crisis. Third, he knew right away that he at least immediately recognized the fact that his son had caused a storm in the group, and knew how to back away without saying a word.
“You do that.”
“there’s nothing we can do. First of all, I’m going to sort out two places.”
Ryu Geun-il picked up the phone and said.
“Oh, it’s me. The short selling of Samwhan Securities and Yooil Securities is also arranged step by step. okay. Don’t forget to buy at the lowest possible price.”
The president, who watched as he couldn’t let go of his regrets until the very end, sighed silently.
The old man is well aware that his body is not good enough. No, I don’t know how long I can last.
I’ve been so exhausted over the past year. The performance of group affiliates was the worst, and bad things happened one after another.
The youngest, dearly loved, had a major accident in America, and the most beloved of his grandchildren was also involved in a very bad thing.
Moreover, it is the saddest thing that the third has been pushed out in the meantime.
The two sons, who will inherit the group after he dies, are not at all suspicious.
“this!”
The old man is contemplating for a moment, and the first shouts.
The old man was watching the monitor now, so he could see why. The stock price suddenly jumped.
“I think it’s because of the amount we buy… … Ha, children. Just be a little quicker.”
“I can’t help it. There is not much for sale.”
If you are forced to buy in order to reduce the loss from short selling, it is natural for a short squeeze that follows a sharp rise in the stock price, as the stock is squeezed out even if it is not.
“Because of a fucking bastard, what the hell is this?”
The two sons begin to mumble.
I can’t be serious have no patience
In President Ryu’s eyes, only the shortcomings of his sons are now visible.
“I’m tired now, so I’ll go inside. From now on, you do it yourself.”
I tried to force myself to endure it, but now I can’t afford it anymore. Perhaps because of the disappointment of his two sons.
Chairman Ryu got up from his seat, and lost his energy and sat down.
The chief of the secretary, seeing this, quickly supported him.
“doctor. Call the doctor.”
The eldest son instructed the young secretary who was standing behind him.
“Okay. You can go and lie down for a while.”
The old man headed to the bedroom, supported by the chief of staff.
“What are you doing? What do you do if you place an order so carelessly? Can’t you do it right?”
The second son had just picked up the phone and was yelling.
As the chief of staff said, he acknowledged the need to organize short selling, but he could not stand the loss of the remaining profits.
Perhaps because of his instructions, the purchase price went down and the stock price went into a lull for a while.
The chief of staff, who had brought the president into the bedroom and came out of the living room, frowned upon seeing it.
I wanted to say that now is not the time to dwell on small profits or losses, but I knew all too well that my words were useless in the absence of the chairman.
In fact, the brothers cannot be said to be so lacking as managers.
It is true that the three brothers each played their own role in raising the Daeyang Group.
However, the qualities of a manager and that of an investor are very different.
In an environment like Korea, it is important for a successful manager to have a lot of fighting spirit and political power, but to be successful as an investor, a calmer eye and self-objectification are much more important.
The brothers obviously lacked that.
And as time goes by, the stock price starts to slowly rise again.
“Ouch! What’s going on? What are you guys doing again?”
The eldest son asked his brother.
“These children are real! hey! What are you doing now? aren’t you doing it right? what? You haven’t placed an order? no. So what have you done so far? I should have bought more when it was a little cheaper! I’m not doing anything right!”
Ryu Geun-il yelled at the receiver. When his father left his seat, the character he had been holding down came out.
The chief of staff, who watched the scene, took a small deep breath and hid a sigh.
The eldest son or the second son is not an ordinary person. They are very difficult to meet.
Throughout the day, Ryu Geun-il picked up the phone and intervened frequently, giving orders and yelling.
But there is no way to do anything about the stock price that has already burned out. Moreover, I was in a position where I had to place a buy order for liquidation, which made it even more frustrating.
That same day, the stock price eventually hit the upper limit again.
* * *
At the old house of the founder of Dasan Group, located at the foot of Bukaksan, men from the past were sitting and chatting.
“her! That’s scary. I can never be an enemy with that friend.”
There was a smile on the lips of the president of Dasan Motors, who said it was scary.
“That’s it. It is terrifying to think that we were in the ocean position.”
Cheol-ho Kim, the third son of the group chairman and vice president of Dasan Finance, struck a match.
“If you think about it, he has nothing to protect. All I have is money, so I have no idea where or how to attack.”
“However, even if there is a small industrial company that my father is running, he is showing very clearly what will happen if he attacks it.”
“The ocean is clear now. I am destined to continue being dragged by that friend.”
“There is no way. way. No matter how hard you try, in the end, you just end up defending.”
The brothers were simply enjoying the current situation that was happening to the Daeyang Group.
Daeyang and Dasan are competing in so many fields, so it must be fun.
“Looking like this, doesn’t it feel like you’ve finished reading all the numbers from the beginning and you’re starting?”
“Yes. no doubt It was like that last time at our Chinese factory, and it was like this at Freescale as well. Come to think of it, everything that taught us about what happened in Shanghai was intentional. Looking at my progress so far, I can’t say I was just lucky.”
“Once or twice, luck. If it’s three or four, is that luck? When I said the first time I had bet 100 billion dollars on Brexit, I thought it was over, but how goosebumps were you after you opened the lid that day?”
“Certainly, the eyes that look ahead are terrifying. A person like that should never be an enemy.”
Kim Soo-ho, the second person who recently met Eugene the most, said as if assertively.
“So, how did the decision to take over Freescale work out?”
This is the reason for today’s meeting. Kim Soo-ho, vice president of Dasan Electronics, gathered the brothers to report the outcome of the negotiations.
The Freescale acquisition is not limited to the former.
“Yes. It looks like it will come to an end today. Well, they didn’t make such an unreasonable demand, so we decided to add another $1.6 billion.”
Eugene sold Freescale for $8.96 billion to Dasan for $11.6 billion.
It took just a few people to get a deal done, and made $2.6 billion in just a few months.
With quite a few commissions and other expenses involved in Neuberger Berman, the actual revenue is just over $2 billion.
“After subtracting the fees, it is almost the same as the original price.”
Dasan does not know how much Eugene spent on the acquisition of Freescale.
“Didn’t you decide to make it around 15 billion?”
The face of the eldest son who was listening was not so bright.
“Eugene The friend said he didn’t like dangerous things. Working in the US, I’m not sure if I’m an American. Well, there is nothing I can do.”
Dasan wanted to take over Freescale for $15 billion and, instead, get a rebate by dividing the difference between the amount Eugene asked for 7 to 3.
If the actual demand is $12 billion, you are expecting a rebate of about $2 billion.
However, Eugene cut it off with a single knife saying that he could not provide illegal funds of any kind.
It is because we know well how dangerous a small illegal act can turn into in the future.
“The friend said that he had a small wall, so he couldn’t do dangerous things. haha. “If someone betting $100 billion on Brexit had a small wall, what would they have done if the wall was bigger, and they said they would have put in $1 trillion in full leverage.”
“Great. a scary person Talking about a trillion dollars so easily… … Anyway, it’s a pity.”
Like a large Korean conglomerate, Dasan’s side was accustomed to seeing small, hidden profits in large transactions or, conversely, giving profits to others.
As the Dasan Group, which has grown in size through various overseas projects, starting with Dasan Construction in the 1970s, it felt natural to create such a slush fund and use that slush fund for purposes that could not be disclosed to the outside world.
In particular, such funds were necessary to do business in many countries in Western and Southeast Asia, where dictators are in power.
It is only natural that a 10% rebate would be required to win a $1 billion business. Otherwise, bidding is useless.
The fact that Dasan was able to win numerous orders by defeating leading companies in the Western world without hesitation in doing what was happening under the water played a big role.
However, American and Western European companies tend to be much more generous than Koreans in that regard.
In Korea, even if something like this is discovered, you can somehow get out, but in developed countries, a single immorality can rip up the entire management and spend a considerable amount of time in prison.
This may mean that illegal slush funds have improved the competitiveness of Korean companies.
So, you can forcefully excuse the fact that Korean conglomerates have had to create slush funds in order to grow, not just for the benefit of their owners, but also because there are aspects that are essential to running a business.
But in the end, it doesn’t change the fact that they are doing illegal things for their own benefit.
“Instead, they offer to open a fund for us.”
“fund? Those good-looking funds? her! Really? how much?”
The eldest son’s face widened visibly.
“They say $500 million is the best.”
“Ah, that friend. I haven’t seen it that way, but it’s pretty cool. what is five billion dollars Five billion dollars.”
“Still, looking at his return, I thought he was actually doing 500 million dollars.”
“What… … I don’t. Who in the world can make such a stable profit? Even 50% of the time a year, that’s somewhere.”
“Anyway, it is true that the favor is right.”
The eldest son nodded.
“Then United Excellence has some spare money, so we should put it in right away.”
“If you look at it that way, it’s really a blessing. After getting to know him, good things happen.”
“okay. Still, you can’t just believe it.”
“Isn’t it obvious? Who else in the world can you trust other than your family? haha.”
The four brothers looked at each other like that and burst into friendly laughter.